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What changed in Qorvo, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Qorvo, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+382 added−362 removedSource: 10-K (2024-05-20) vs 10-K (2022-05-20)

Top changes in Qorvo, Inc.'s 2024 10-K

382 paragraphs added · 362 removed · 251 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

64 edited+30 added−28 removed17 unchanged
Biggest changeAs we make plans to transition to return to the office, we will provide our employees with work arrangements that support flexibility, while maintaining our strong culture of innovation, collaboration, openness and camaraderie, in addition to a safe working environment for our employees. The success of our business is fundamentally connected to the well-being of our employees.
Biggest changeTeam members utilize our online near miss and hazard reporting system, a system critical to prevent worker injury. The success of our business is fundamentally connected to the well-being of our employees. We provide our employees with work arrangements that support flexibility, while maintaining our strong culture of innovation, collaboration and camaraderie.
We also source technologies in cooperation with key suppliers, including silicon on insulator ("SOI") for switches and tuners, silicon germanium ("SiGe") for amplifiers, complementary metal oxide semiconductor ("CMOS") for power management devices and SoC solutions, MEMS technology for switches and force-sensing and SiC for high voltage power conversion devices.
We also source technologies in cooperation with key suppliers, including silicon on insulator ("SOI") for LNAs, switches and tuners, silicon germanium ("SiGe") for amplifiers and LNAs, complementary metal oxide semiconductor ("CMOS") for power management devices and SoC solutions, MEMS technology for switches and force-sensing and SiC for high-voltage power conversion devices.
Access to Public Information We make available, free of charge through our website (https://www.qorvo.com), our annual and quarterly reports on Forms 10-K and 10-Q (including exhibits and related filings in iXBRL format) and current reports on Form 8-K and amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") as soon as reasonably practicable after we electronically file these reports with, or furnish them to, the United States Securities and Exchange Commission ("SEC").
Available Information We make available, free of charge through our website (https://www.qorvo.com), our annual and quarterly reports on Forms 10-K and 10-Q (including exhibits and related filings in iXBRL format) and current reports on Form 8-K and amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") as soon as reasonably practicable after we electronically file these reports with, or furnish them to, the United States Securities and Exchange Commission ("SEC").
AS 9100 is the standardized quality management system for the aerospace industry. ISO 14001 is an internationally agreed upon standard for an environmental management system.
AS 9100 is the standardized quality management system for the aerospace industry. ISO 14001 is an internationally agreed upon standard for an Environmental Management System ("EMS").
We are an ISO 14001:2015 certified manufacturer with a comprehensive Environmental Management System ("EMS") in place to help ensure control of the environmental aspects of the manufacturing process. Our EMS mandates compliance and establishes appropriate checks and balances to minimize the potential for non-compliance with environmental laws and regulations.
We are an ISO 14001:2015 certified manufacturer with a comprehensive EMS in place to help ensure control of the environmental aspects of the manufacturing process. Our EMS mandates compliance and establishes appropriate checks and balances to minimize the potential for non-compliance with environmental laws and regulations.
We benchmark our compensation and benefits packages annually to ensure we remain competitive with our peers and continue to attract and retain talent throughout our organization. Employee Recruitment, Retention and Development We are committed to recruiting, hiring, retaining, promoting and engaging a diverse workforce to best serve our global customers.
We routinely benchmark our compensation and benefits packages to ensure we remain competitive with our peers and continue to attract and retain talent throughout our organization. Employee Recruitment, Retention and Development We are committed to recruiting, hiring, retaining, promoting and engaging a diverse workforce to best serve our global customers.
We use a combination of compensation and other programs (which vary by region and salary grade) to attract, motivate and retain our employees, including semiannual performance bonuses, stock awards, an employee stock purchase plan, retirement programs, health savings and flexible spending accounts, paid time off, family leave, family care resources, flexible work schedules, employee assistance programs, tuition assistance, health and wellness benefits and programs, and on-site fitness centers.
Competitive Pay and Benefits We use a combination of compensation and other programs (which vary by region and salary grade) to attract, develop, motivate and retain our employees, including semiannual performance bonuses, stock awards, an employee stock purchase plan, retirement programs, health savings and flexible spending accounts, paid time off, family leave, family care resources, flexible work schedules, employee assistance programs, tuition assistance, health and wellness benefits and programs and on-site fitness centers.
The public may also request a copy of our forms filed with the SEC, without charge upon written request, directed to: Investor Relations Department Qorvo, Inc., 7628 Thorndike Road, Greensboro, NC 27409-9421 The information contained on, or that can be accessed through, our website is not incorporated by reference or considered to be a part of this Annual Report on Form 10-K.
The public may also request a copy of our forms filed with the SEC, without charge upon written request, directed to: Investor Relations Department Qorvo, Inc. 7628 Thorndike Road Greensboro, NC 27409-9421 The information contained on or accessible through our website is not incorporated by reference or considered to be a part of this Annual Report on Form 10-K.
These programs provide tools and resources that emphasize preventive care, encourage healthy behaviors, such as health coaches and wellness incentives, and are designed to help cultivate a productive work environment, while also focusing on the well-being of our employees.
These programs provide tools and resources, such 11 Table of Contents as health coaches and wellness incentives, that emphasize preventive care, encourage healthy behaviors, and are designed to help cultivate a productive work environment, while also focusing on the well-being of our employees.
We combine these technologies with proprietary design methods, intellectual property ("IP") and other expertise to improve performance, increase integration and reduce the size and cost of our products. 7 Table of Contents We develop and qualify advanced packaging technologies to reduce component size, improve performance and reduce package costs.
We combine these technologies with proprietary design methods, intellectual property ("IP") and other expertise to improve performance, increase integration and reduce the size and cost of our products. We develop and qualify advanced packaging technologies to reduce component size, improve performance and reduce package costs.
These controls, tariffs, regulations, and restrictions (including those related to, or affected by, United States-China relations, as discussed below in Item 1A, "Risk Factors") may have a material impact on our business, including our ability to sell products and to manufacture or source components.
These controls, tariffs, regulations and restrictions (including those related to, or affected by, U.S./China relations, as discussed below in Item 1A, "Risk Factors") may have a material impact on our business, including our ability to sell products and to manufacture or source components.
We continuously improve the environmental aspects of our manufacturing processes and are dedicated to: • providing a safe and healthy work environment for our employees; • complying with regulatory and other requirements; • using natural resources, energy, and materials efficiently; 11 Table of Contents • substituting sustainable resources in place of non-renewable resources; • reusing or recycling materials wherever technically possible and economically reasonable; • minimizing waste and disposing of waste safely and responsibly; • sourcing raw material responsibly; and • implementing specific measures to prevent and minimize hazards to humans and the environment including pollution prevention.
We continuously improve the environmental aspects of our manufacturing processes and are dedicated to: • providing a safe and healthy work environment for our employees; • complying with regulatory and other requirements; • using natural resources, energy and materials efficiently; • evaluating ways to substitute sustainable resources in place of non-renewable resources; • reusing or recycling materials wherever technically possible and economically reasonable; • minimizing waste and disposing of waste safely and responsibly; • sourcing raw material responsibly; and • implementing specific measures to prevent and minimize hazards to humans and the environment including pollution prevention.
In view of our rapid innovation and product development and the comparative pace of governments’ patenting processes, there is no guarantee that our products will not be obsolete before the related patents expire or are granted.
In view of our rapid innovation and product development and the comparative pace of governments’ patenting processes, there is no guarantee that patented technology for our products and services will not be obsolete before the related patents expire or are granted.
Our customers’ product life cycles can be short, and our competitiveness depends on our ability to improve our products and processes faster than our competitors, anticipate changing customer requirements and successfully develop and launch new products while reducing our costs.
Our customers’ product life cycles can be short, especially in mobile devices, and our competitiveness depends on our ability to improve our products and processes faster than our competitors, anticipate changing customer requirements and successfully develop and launch new products while reducing our costs.
Our competitiveness is also affected by the quality of our customer service and technical support and our ability to design customized products that address each customer’s particular requirements. The selection process for our products is highly competitive, and our customers provide no guarantees that our products will be included in the next-generation of products introduced.
Our competitiveness is also affected by the quality of our customer service, including technical support, and in some cases our ability to design customized products that address certain customer’s specific requirements. The selection process for our products is highly competitive, and our customers provide no guarantees that our products will be included in the next generation of products introduced.
The SEC maintains a website at https://www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.
The SEC maintains a website at https://www.sec.gov that contains reports, proxy and information statements and other information 12 Table of Contents regarding issuers that file electronically with the SEC.
The majority of our products are multi-chip modules utilizing multiple semiconductor and acoustic material processing technologies. These products have varying degrees of complexity and contain semiconductors and other components that are manufactured internally or sourced from outside supply chain partners.
A substantial portion of our revenue comes from multi-chip modules utilizing multiple semiconductor and acoustic material processing technologies. These products have varying degrees of complexity and contain semiconductors and other components that are manufactured internally or sourced from outside supply chain partners.
Our R&D efforts require us to focus on both continuous improvement and innovation in fundamental areas including materials, software, semiconductor process technologies, simulation and modeling, systems architecture, circuit design, device packaging, module integration and test. We have developed multiple generations of GaAs, GaN, BAW and surface acoustic wave ("SAW") process technologies that we manufacture.
Our R&D efforts focus on innovation in fundamental areas including materials, software, semiconductor process technologies, simulation and modeling, systems architecture, circuit design, device packaging, module integration and test capabilities. We have developed multiple generations of gallium arsenide ("GaAs"), gallium nitride ("GaN"), BAW and surface acoustic wave ("SAW") process technologies that we manufacture.
Our SiC portfolio includes Schottky diodes and transistors ranging in voltage from 650V to 1700V. Power levels vary from 650 watts to hundreds of kilowatts, and markets include automotive, industrial, IT infrastructure and renewable energy. Qorvo’s power management solutions include programmable power management integrated circuits ("ICs") and power application controllers (PACs®).
Our SiC portfolio includes Schottky diodes and transistors ranging in voltage from 650V to 1700V. Power levels vary from 650 watts to hundreds of kilowatts, and markets include automotive, industrial, IT infrastructure and renewable energy.
We strive to meet these objectives by offering competitive pay and benefits in a diverse, inclusive and safe workplace and by providing opportunities for our employees to grow and develop their careers. As of April 2, 2022, we employed over 8,900 full and part-time employees in 22 countries.
We strive to meet these objectives by offering competitive pay and benefits in a diverse, inclusive and safe workplace and by providing opportunities for our employees to grow and develop their careers. As of March 30, 2024, we employed approximately 8,700 full and part-time employees in 23 countries.
We maintain close relationships with our customers and chipset suppliers and provide them strong technical support to enhance their customer experience and help anticipate future product needs. Seasonality Our sales are the result of standard purchase orders or specific agreements with customers. Our revenue fluctuates based on consumer demand for devices as well as the timing of customer device launches.
We maintain close relationships with our customers and chipset suppliers and provide them with strong technical support to enhance their customer experience and help anticipate future product needs. Seasonality Our sales are the result of standard purchase orders or specific agreements with customers.
Safety, Health and Wellness We are a member of the Responsible Business Alliance ("RBA"), an industry coalition dedicated to driving sustainable value for workers in global supply chains, among other things.
These and other efforts help promote an inclusive workplace of talented employees and drive employee engagement. Safety, Health and Wellness We are a member of the Responsible Business Alliance (the "RBA"), an industry coalition dedicated to driving sustainable value for workers in global supply chains, among other things.
We require that all of our key vendors and suppliers be compliant with applicable standards. 8 Table of Contents Customers We design, develop, manufacture and market products for leading U.S. and international OEMs and original design manufacturers ("ODMs"). We also collaborate with leading reference design partners. We provide products to our largest end customer, Apple Inc.
We require that all of our key vendors and suppliers be compliant with applicable standards. 8 Table of Contents Customers We design, develop, manufacture and market our products and solutions for leading U.S. and international OEMs and original design manufacturers ("ODMs").
Advances in mobile devices have transformed how end users around the world access content, interact with their physical and virtual communities and transact commerce.
Advances in mobile devices are transforming how end users around the world access content, interact with communities and transact commerce.
We have approximately 2,200 patents that expire from 2022 to 2041. We also continue to acquire patents through acquisitions or direct prosecution efforts and engage in licensing transactions to secure the right to use third-parties’ patents.
We also continue to acquire patents through acquisitions or direct prosecution efforts and engage in licensing transactions to secure the right to use third-parties’ patents.
IDP competes primarily with Analog Devices, Inc.; Broadcom Inc.; Infineon Technologies AG; MACOM Technology Solutions Inc.; Murata Manufacturing Co., Ltd.; Nordic Semiconductor; NXP Semiconductors N.V.; ON Semiconductor Corporation; Qualcomm Technologies, Inc.; Silicon Laboratories Inc.; Skyworks Solutions, Inc.; STMicroelectronics N.V.; Sumitomo Electric Device Innovations; and Wolfspeed, Inc.
HPA competes primarily with Analog Devices, Inc.; Infineon Technologies AG; MACOM Technology Solutions Holdings, Inc.; Monolithic Power Systems, Inc.; NXP Semiconductors N.V.; ON Semiconductor Corporation; STMicroelectronics N.V.; Sumitomo Electric Device Innovations; Texas Instruments, Inc.; and Wolfspeed, Inc. CSG competes primarily with Broadcom Inc.; Nordic Semiconductor; NXP Semiconductors N.V.; Qualcomm Technologies, Inc.; Silicon Laboratories Inc.; and Skyworks Solutions, Inc.
Our sales and customer support centers are located near our customers throughout the world. Our website contains extensive product information and includes an online store where customers can learn about our products, download product catalogs, order product samples and request evaluation boards.
Our website contains extensive product information and includes an online store where customers can learn about our products, download product catalogs, order products and samples and request evaluation boards.
Mobile devices are migrating to 5G architectures and technologies which increase data throughput, reduce signal latency and enable massive machine-to-machine connectivity. 5G devices operate over a wide range of frequencies and face challenges related to efficiency, linearity, signal coexistence, signal integrity and form factor. 5G architectures are more complex and include Multiple-Input/Multiple-Output ("MIMO"), secondary transmit, higher frequencies with wider bandwidths and new receive paths featuring carrier aggregation.
The migration to 5G enables higher data throughput, lower signal latency and massive machine-type communication. 5G devices operate over a wide range of frequencies and face challenges related to efficiency, linearity, signal coexistence, signal integrity and form factor. 5G architectures are more complex and include Multiple-Input/Multiple-Output, higher frequencies with wider bandwidths and new paths featuring carrier aggregation.
Government regulations are subject to change, and accordingly we are unable to assess the possible effect of compliance with future requirements or whether our compliance with such regulations will materially impact our business, results of operations or financial condition. Cybersecurity Qorvo’s cybersecurity program is built around the ISO and National Institute for Standards and Technology frameworks.
Government regulations are subject to change, and accordingly we are unable to assess the possible effect of compliance with future requirements or whether our compliance with such regulations will materially impact our business, results of operations or financial condition.
IoT connected devices allow remote access and control of various functions, including entertainment, comfort, security, energy usage and health or general status monitoring, in home and office environments. These devices can be controlled through a computer, tablet or smartphone, or through a more direct peer-to-peer device such as a voice-enabled remote control.
Connected home devices allow remote access and control of applications including entertainment, comfort, health monitoring and property monitoring and security. These devices can be controlled through a computer, tablet or smartphone, or through a direct peer-to-peer device such as a voice-enabled remote control, tablet or home control assistant.
Qorvo supports the world’s leading cellular base station OEMs with a broad portfolio of infrastructure solutions to address requirements for increased data capacity and throughput and improved efficiency. Qorvo’s products for cellular base stations include switch-low noise amplifier ("LNA") modules, variable gain amplifiers, integrated power amplifier ("PA") Doherty modules, discrete LNAs and high power GaN amplifiers.
Qorvo supports cellular base station OEMs with a broad portfolio of infrastructure solutions to address their most critical requirements for data capacity, throughput and efficiency. Qorvo's cellular infrastructure products include switches, filters, low noise amplifier ("LNA") modules, discrete LNAs, variable gain amplifiers and control circuits.
Many of our current and potential competitors have entrenched market positions and customer relationships, established patents and other IP and substantial technological capabilities. In some cases, our competitors are also our customers or suppliers.
ACG competes primarily with Broadcom Inc.; Murata Manufacturing Co., Ltd.; Qualcomm Technologies, Inc.; and Skyworks Solutions, Inc. Many of our current and potential competitors have strong market positions and customer relationships, established patents and other IP, and substantial technological capabilities. In some cases, our competitors are also our customers or suppliers.
We provide ongoing educational training about our products to our internal and external sales representatives and distributors. We maintain an internal sales and marketing organization that is responsible for key account management, application engineering support for customers, sales and advertising literature, and technical presentations for industry conferences.
We maintain an internal sales and marketing organization that is responsible for key account management, application engineering support for customers, sales and advertising literature and technical presentations for industry conferences. Our sales and customer support centers are located near our customers throughout the world.
Additionally, many of our competitors may have significant financial, technical, manufacturing and marketing resources, which may allow them to more quickly implement new technologies and develop new products. 9 Table of Contents Intellectual Property Our IP, including patents, copyrights, trademarks and trade secrets, is important to our business, and we actively seek opportunities to leverage our IP portfolio to promote our business interests.
Additionally, many of our competitors have significant financial, technical, manufacturing 9 Table of Contents and marketing resources, which may allow them to more quickly implement new technologies and develop new products.
We have established relationships with professional associations and industry groups to proactively attract talent, and we partner with universities for our internship program. We believe that our commitment to our internship program and university partnerships contributes to developing the next generation of talent, including engineers in our industry, and provides a pipeline of recent college graduates into our talent pool.
We believe that our internship program and university partnerships contribute to developing the next 10 Table of Contents generation of talent, including engineers in our industry, and provide a pipeline of recent college graduates into our talent pool.
We also actively monitor and protect our global IP rights to deter unauthorized use of our IP and other assets. These efforts can be difficult because of the absence of consistent international standards and laws. In addition, the laws of some foreign countries do not protect IP rights to the same extent as U.S. laws.
These efforts can be difficult because of the absence of consistent international standards and laws. In addition, the laws of some foreign countries do not protect IP rights to the same extent as U.S. laws. We respect the IP rights of others and have implemented policies and procedures to mitigate the risk of infringing or misappropriating third-party IP.
The trend toward phased array radar, the shift to higher frequencies and the sharing of existing frequency bands with cellular communications are expanding the content opportunity for Qorvo’s high-performance defense RF technologies and solutions. We are a leading supplier of RF products and compound semiconductor foundry services to defense primes and other global defense and aerospace customers.
Within these markets, the adoption of phased array radar, the introduction of new frequency bands and the shift to higher frequencies expand the opportunity for our products and technologies across a broad frequency spectrum. We are a leading supplier of RF products and compound semiconductor foundry services to defense primes and other global defense and aerospace customers.
Sales and Marketing We sell our products worldwide both directly to customers and through a network of U.S. and foreign sales representative firms and distributors. We select our sales representatives based on technical skills and sales experience, the presence of complementary product lines and the customer base served.
We select our sales representative firms and distributors based on technical skills and sales experience, the presence of complementary product lines and the customer base served. We provide ongoing educational training about our products to our internal and external sales representatives and distributors.
We respect the IP rights of others and have implemented policies and procedures to mitigate the risk of infringing or misappropriating third-party IP. Patent applications are filed within the U.S. and in other countries where we have a market presence. On occasion, some applications do not mature into patents for various reasons, including rejections based on prior art.
Patent applications are filed within the U.S. and in other strategic countries where we have a market presence. On occasion, some applications do not mature into patents for various reasons, including rejections based on prior art. We have approximately 2,300 patents that have expiration dates between 2024 and 2042.
Our programmable power management ICs provide customers digital and analog power control. They reduce solution size, lower cost, improve system reliability and shorten our customers’ product development time. Our power management products manage voltages from 1.8V to 600V and power up to 4,000 watts.
They reduce solution size, improve battery life, lower cost, improve system reliability and shorten our customers’ product development time. Our power management products manage voltages from 1.8V to 600V and power levels up to 4,000 watts. Qorvo’s silicon carbide ("SiC") power devices provide state-of-the-art efficiency in a range of power conversion applications.
The coexistence of low power wireless protocols, such as Bluetooth Low Energy, Zigbee, and Thread, in single-placement SoCs reduces form factor, extends battery life and advances the proliferation of IoT devices. Similarly, Matter is an open and universal smart home protocol expected to simplify and accelerate interoperability across IoT devices and platforms.
The coexistence of multiple low-power wireless protocols in a SoC reduces form factor, extends battery life and helps advance the proliferation of IoT devices. To simplify the interoperability challenges of a multi-protocol environment, an open and universal smart home overlay known as Matter was developed to accelerate adoption of IoT devices and platforms.
Wireless Connectivity The proliferation of data-driven connected devices that sense, process and communicate is increasing demand for wireless connectivity solutions that improve speed, capacity and efficiency. Use cases in consumer, commercial and industrial IoT applications include connected cars, cloud gaming, AR/VR, telemedicine and factory automation. Each benefit from faster throughput, lower latency, more security, greater reliability and smaller form factors.
Connectivity and Sensing The proliferation of data-driven, connected devices that sense, process and communicate are driving demand for wireless connectivity solutions that increase throughput, reduce latency, enhance security and maximize efficiency. Use cases in consumer, commercial and industrial IoT applications include connected home, AR/VR, healthcare and factory automation.
The upcoming Wi-Fi 7 standard will double the channel bandwidth and number of spatial streams available with Wi-Fi 6E and use multi-link operation to combine portions of the 5 GHz and 6 GHz bands into a single link. This will enable faster speeds over longer distances than previous standards.
The Wi-Fi 7 standard doubles the channel bandwidth and number of spatial streams compared to Wi-Fi 6E and uses multi-link operation to combine portions of the 5 GHz and 6 GHz bands into a single link, enabling faster speeds over longer distances. As standards and architectures evolve, functional requirements increase and demand more highly integrated RF front end solutions.
Our efforts to foster a diverse and inclusive workplace include partnering with organizations in our surrounding communities that advocate for gender, race and ethnicity, socioeconomic, disability and LGBTQ+ equality. These and other efforts help promote an inclusive workplace of talented employees and drive employee engagement.
Diversity and inclusion principles are threaded across the entire company, and employees are equipped with the knowledge and capabilities to welcome and embrace diversity and advocate for inclusion. Our efforts to foster a diverse and inclusive workplace include partnering with organizations in our surrounding communities that advocate for gender, race and ethnicity, socioeconomic, disability and LGBTQ+ equality.
Other factors such as macroeconomic effects and the timing of the next generation of technologies can also impact the fluctuations in demand. Competition We operate in a competitive industry generally characterized by rapid advances in technology and new product introductions.
Competition We operate in a competitive industry generally characterized by rapid advances in technology and new product introductions.
We routinely qualify additional manufacturing sites and sources of supply to reduce the risk of supply interruptions or price increases, and we closely monitor our suppliers’ key performance indicators. We seek to ensure that materials and manufacturing services are available from multiple sources and geographic locations.
Our manufacturing strategy includes a balance of internal and external capacity. Our manufacturing sites are geographically distributed and service all three operating segments. We routinely qualify additional manufacturing sites and sources of supply to reduce the risk of supply interruptions or price increases, and we continuously monitor our suppliers’ key performance indicators.
Industry trends in EVs/hybrid-EVs, renewable energy systems, battery-operated portable devices, EV chargers/on-board chargers, data storage, circuit protection and similar applications, are sharpening the focus on power efficiency and increasing the demand for our power management and power conversion solutions. Qorvo’s SiC power devices provide state-of-the-art efficiency in a range of power conversion applications.
Trends in infrastructure (such as data storage and cloud servers), industrial power, renewable energy systems, electric vehicles ("EVs")/hybrid-EVs, battery-operated portable devices, EV chargers, on-board chargers and e-mobility (e-bikes, robots and scooters) require better power efficiency and are increasing the demand for our power management solutions.
ITEM 1. BUSINESS. Company Overview Qorvo® is a global leader in the development and commercialization of technologies and products for wireless, wired and power markets. We have two reportable segments: Mobile Products ("MP") and Infrastructure and Defense Products ("IDP").
ITEM 1. BUSINESS. Company Overview Qorvo ® is a global leader in the development and commercialization of technologies and products for wireless, wired and power markets. We are organized into three operating and reportable segments that align our technologies and applications with customers and end markets: High Performance Analog ("HPA"), Connectivity and Sensors Group ("CSG") and Advanced Cellular Group ("ACG").
Our internal manufacturing facilities require a high level of fixed costs, consisting primarily of occupancy costs, maintenance, repair, equipment depreciation, and labor costs related to manufacturing and process engineering. Semiconductor fabrication requires highly controlled and clean environments.
To maximize wafer yields and quality, we test products multiple times, maintain continuous reliability monitoring and conduct numerous quality control inspections throughout the production flow. Our internal manufacturing facilities require a high level of fixed costs, consisting primarily of occupancy costs, maintenance, repair, equipment depreciation and labor costs related to manufacturing and process engineering.
("Apple"), through sales to multiple contract manufacturers, which in the aggregate accounted for 33% and 30% of total revenue in fiscal years 2022 and 2021, respectively. Samsung Electronics Co., Ltd. ("Samsung") accounted for 11% and 7% of total revenue in fiscal years 2022 and 2021, respectively. These customers primarily purchase RF solutions for a variety of mobile devices.
Samsung Electronics Co., Ltd. ("Samsung") accounted for 12% of total revenue in both fiscal years 2024 and 2023. These customers primarily purchase RF solutions for a variety of mobile devices. Sales and Marketing We sell our products worldwide both directly to customers and through a network of U.S. and foreign sales representative firms and distributors.
In our GaN and GaAs manufacturing operations, we use several raw materials, including GaN on SiC wafers and GaAs wafers. In our acoustic filter manufacturing operations, raw materials include silicon, lithium niobate and lithium tantalate. We procure our materials, parts and supplies from a large number of sources through established purchase contracts with suppliers or on a purchase order basis.
In our GaN and GaAs manufacturing operations, we use several raw materials, including GaN on SiC wafers and GaAs wafers. In our acoustic filter manufacturing operations, raw materials include silicon, lithium niobate and lithium tantalate. Our procurement and supply chain functions are centralized and service all three operating segments.
We prioritize safe working conditions for our employees as well as our on-site contractors and visitors. We are committed to an injury-free workplace and provide dedicated workplace training and leadership support to reduce or eliminate health and safety risks. In response to the COVID-19 pandemic, we instituted comprehensive safety protocols for all Qorvo facilities.
We are committed to an injury-free workplace and provide dedicated workplace training and leadership support to reduce or eliminate health and safety risks. In fiscal 2024, we achieved our safety goal for the sixth consecutive year. Our site-specific health and safety teams are critical in fostering a positive safety culture.
Our product portfolio also includes RF power management integrated circuits, UWB SoC and system-in-package ("SiP") solutions, MEMS-based sensors, antenna tuners, antennaplexers, as well as discrete multiplexers, duplexers, filters, and switches. Cellular Base Stations Operators of cellular base stations are migrating to 5G in order to increase capacity, expand coverage and lower the cost per bit of data delivered.
Our portfolio includes highly integrated and functionally dense RF modules, power management integrated circuits ("PMICs"), UWB system-on-a-chip ("SoC") and system-in-package ("SiP") solutions, MEMS-based sensors, antenna tuners, antennaplexers, as well as discrete multiplexers, duplexers, filters and switches. Our products are manufactured using multiple process technologies and combined in various, miniaturized form factors.
We have a global supply chain and ship millions of units per day. We have our own flip chip, wire bond and wafer-level packaging technologies. We primarily use internal assembly facilities in China, Costa Rica, Germany and the U.S., and we also use external suppliers for these and other packaging technologies.
We also use multiple silicon-based process technologies, including SiC, SOI, SiGe and bulk CMOS, which are principally sourced from leading silicon foundries located throughout the world. We have a global supply chain and ship millions of units per day. We have our own flip chip, wire bond and wafer-level packaging technologies.
We have design, sales and other manufacturing facilities throughout Asia, Europe and North America. 4 Table of Contents In addition to organic growth, our strategy may include the acquisition of businesses, assets and technologies that allow us to complement our existing product offerings and design capabilities to drive growth in new or existing markets.
ACG is a leading global supplier of cellular RF solutions for smartphones, wearables, laptops, tablets and other devices. In addition to organic growth, our strategy includes the potential acquisition of businesses, assets and technologies that complement our existing capabilities and enable us to drive growth in new or existing markets.
In Wi-Fi, new standards feature higher order MIMO architectures and offer greater range and capacity. The adoption of new standards, such as 802.11ax (Wi-Fi 6), Wi-Fi 6E and Wi-Fi 7, increases data throughput and enable new use cases.
Use cases include automotive smart interiors, laptop trackpads, smartphones and other applications. In Wi-Fi, new standards and architectures, such as 802.11ax (Wi-Fi 6 and Wi-Fi 6E) and 802.11be (Wi-Fi 7), are enhancing performance, increasing range and capacity and enabling new use cases.
They are also seeking to adopt force-sensing touch sensor technology to enhance human-machine touch interfaces, create new consumer experiences and advance industrial design. Qorvo’s products for mobile devices include highly integrated RF solutions which incorporate filters, switches, amplifiers, multiplexers and other components in a single package.
In addition, mobile device original equipment manufacturers ("OEMs") are leveraging UWB's precision-location accuracy to enhance functionality with applications that can offer secure remote access, indoor navigation and other functionality. They are also seeking to adopt force-sensing touch sensor technology to enhance human-machine interfaces, create new consumer experiences and advance industrial design.
To solve our customers’ most critical RF and power-related challenges, our products enhance performance, improve efficiency, increase functionality, reduce complexity, enable smaller form factors and address other critical challenges. Mobile Devices Qorvo’s largest market is mobile devices, which is a global market characterized by large volumes. It includes smartphones, wearables, laptops, tablets and other devices.
Mobile Devices Qorvo’s largest market is mobile devices, which includes smartphones, wearables, laptops, tablets and other devices and is characterized by complex devices and large unit volumes serving global ecosystems.
By region, approximately 57% of our total employees were in the Americas, 37% in Asia and 6% in Europe. Approximately 60% of our global population was in engineering or technician roles. Competitive Pay and Benefits We provide compensation and benefits packages that we believe are competitive within the applicable market.
By region, approximately 56% of our total employees were in the Americas, 37% in Asia and 7% in Europe. Approximately 62% of our global population was in engineering or technician roles. Upon completion of the transaction to divest our assembly and test operations in China on May 2, 2024, approximately 2,600 of our employees became employees of Luxshare.
We offer e-learning libraries and on-demand training that provide our employees with real-time learning opportunities to help them achieve their career goals, build management skills and lead their organizations. We believe our competitive compensation and benefits programs, along with career growth and development opportunities promote longer employee tenure and reduce turnover.
Additionally, our educational assistance program, which enables employees to pursue their career aspirations, also enhances their professional capabilities and further contributes to our organizational success. We believe our competitive compensation and benefits programs, along with career growth, development and internal mobility opportunities, promote longer employee tenure and reduce turnover.
We operate fabrication facilities for the production of BAW, GaN, GaAs, SAW and Temperature Compensated SAW wafers in North Carolina, Oregon and Texas. We also use multiple silicon-based process technologies, including SOI, SiGe and bulk CMOS, which are principally sourced from leading silicon foundries located throughout the world.
These individual components are combined and assembled into various, miniaturized packages and tested to ensure compliance with customer specifications. We operate fabrication facilities for the production of BAW, GaAs, GaN, SAW and Temperature Compensated SAW wafers in North Carolina, Oregon and Texas.
Manufacturing yields can vary significantly between products, based on a number of factors, including product complexity, performance requirements and the maturity of our manufacturing processes. To maximize wafer yields and quality, we test products multiple times, maintain continuous reliability monitoring and conduct numerous quality control inspections throughout the production flow.
In fiscal 2024, we used internal assembly facilities in China, Costa Rica, Germany and the U.S., and we also used external suppliers located in Asia for these and other packaging technologies. Manufacturing yields can vary significantly between products, based on a number of factors, including product complexity, performance requirements and the maturity of our manufacturing processes.
We monitor employee turnover rates as our success depends upon retaining and investing in our worldwide talent. Our global attrition rate has consistently been below the technology industry average. Diversity, Equity and Inclusion At Qorvo, we value diversity, equity and inclusion and respect the unique talents, experiences, cultures and ideas of our global team members.
We regularly monitor voluntary employee turnover, as our success depends upon retaining highly trained personnel with the technical skills necessary to execute our business objectives. Our global attrition rate has consistently been below the technology industry average. Employee Engagement Qorvo is dedicated to fostering a connected and thriving workforce.
These trends support multiyear technology upgrade cycles in our markets and increase the demand for our technologies and products. Our business is diversified primarily across the following end markets: mobile devices, cellular base stations, power management and conversion, wireless connectivity, defense and aerospace, automotive connectivity and other markets.
These and other global macro trends are increasing the demand for our technologies and products. Our business is diversified across mobile devices, infrastructure, power management, connectivity and sensing, defense and aerospace, and automotive. Our products solve our customers’ most complex challenges while enhancing performance, improving efficiency, increasing functionality, enabling new form factors and addressing other critical challenges.
Removed
MP is a global supplier of cellular, ultra-wideband 802.15.4z ("UWB"), Wi-Fi and other wireless solutions for a variety of applications, including smartphones, wearables, laptops, tablets and the Internet of Things ("IoT").
Added
HPA is a leading global supplier of radio frequency ("RF"), analog mixed signal and power management solutions. CSG is a leading global supplier of connectivity and sensor solutions, with broad expertise spanning ultra-wideband ("UWB"), Matter ® , Bluetooth ® Low Energy, Zigbee ® , Thread ® , Wi-Fi ® , cellular Internet of Things ("IoT") and microelectromechanical system ("MEMS")-based sensors.
Removed
IDP is a global supplier of radio frequency ("RF"), system-on-a-chip ("SoC") and power management solutions for a wide range of markets, including cellular and IT infrastructure, automotive, renewable energy, defense and IoT.
Added
During fiscal 4 Table of Contents 2024, we acquired Anokiwave, Inc. ("Anokiwave"), a leading supplier of high-performance beamforming and mixed signal integrated circuits ("ICs") enabling intelligent active array antennas for defense and aerospace, satellite communication and 5G applications.
Removed
Our MP segment supplies RF solutions to global consumer product companies, and our IDP segment supplies a more diverse portfolio of products with generally longer life cycles to a broader base of customers and end markets. Our design expertise and manufacturing capabilities span multiple process technologies. Our primary wafer fabrication facilities are in North Carolina, Oregon and Texas.
Added
Industry Trends, Markets and Products Global connectivity trends and the proliferation of more intelligent, data-intensive applications are increasing demand for technologies that efficiently increase data throughput, improve user experiences and enable new methods of human-machine interaction. Additionally, global trends related to energy generation, consumption, storage and sustainability are increasing requirements for power management technologies that increase power efficiency.
Removed
Our primary assembly and test facilities are in China, Costa Rica, Germany and Texas. We also source products and materials through external suppliers.
Added
These challenges, along with increases in functionality and complexity, are driving the need for more advanced system-level engineering. This has led to higher levels of integration within RF solutions to achieve the highest standards of performance, power efficiency and functional density.
Removed
During fiscal 2022, we acquired United Silicon Carbide, Inc. ("United SiC"), a provider of silicon carbide ("SiC") power products, and NextInput, Inc. ("NextInput"), a provider of microelectromechanical system ("MEMS")-based sensing products.
Added
Infrastructure Data-intensive use cases such as machine learning, industrial automation, robotics and augmented reality/virtual reality ("AR/VR") are increasing the performance and capacity requirements of wired and wireless 5G networks. In cellular base stations, operators are migrating to 5G to increase capacity, expand coverage and lower the cost per bit of data.
Removed
Industry Trends, Markets and Products Global demand for wireless and wired connectivity, supported by the proliferation of smarter, data-driven, connected devices in a variety of form factors, is increasing network data traffic and raising requirements for throughput and efficiency.
Added
In broadband infrastructure, network operators are migrating from Data Over Cable Service Interface Specification ("DOCSIS") 3.1 to DOCSIS 4.0 to increase the efficiency of existing infrastructure and significantly increase download and upload speeds for end users.
Removed
At the same time, global environmental initiatives and technology advancements related to energy efficiency, sustainability and conservation are driving investments across a range of consumer and industrial applications that demand maximum power efficiency, including in electric vehicles ("EVs") and renewable energy systems.
Added
Qorvo is enabling the transition to DOCSIS 4.0 with a broad portfolio of products including high-output power doublers, drivers, pre-amps, return amps, voltage-controlled attenuators, digital step attenuators, switches and voltage variable equalizers. 5 Table of Contents Power Management Power efficiency is a core requirement in all electronics, and power management is critical to enhancing efficiency.
Removed
In each instance, the increased functionality and greater complexity increase RF content and favor high performance and highly integrated solutions. Mobile device original equipment manufacturers ("OEMs") are adopting UWB technology to enhance functionality, including indoor navigation and secure remote access, leveraging UWB's precision-location accuracy.
Added
Qorvo’s power management solutions include programmable PMICs and single-chip integrated power application controllers (PACs ® ) for motor control and battery management systems. Our reconfigurable core portfolio of programmable PMICs provides customers with digital and analog power control across a broad range of applications.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

103 edited+31 added−21 removed70 unchanged
Biggest changeOur future operating results will depend on many factors, including the following: • business and macroeconomic changes, including trade restrictions and recession or slowing growth in the semiconductor industry and the overall global economy; • political and/or civil unrest, acts of war or other military actions, including any resulting sanctions or other restrictive actions; • changes in consumer confidence caused by many factors, including changes in interest rates, credit markets, unemployment levels, energy or other commodity prices as well as changes in existing and expected rates of inflation; • fluctuations in demand for our customers’ products; • our ability to forecast our customers’ demand for our products accurately; • the ability of third-party foundries and other third-party suppliers to manufacture, assemble and test our products and otherwise deliver on their commitments to us in a timely and cost-effective manner; • our customers’ and distributors’ ability to manage the inventory that they hold and to forecast accurately their demand for our products; • delays in the widespread deployment of commercial 5G networks or in consumer adoption of 5G-enabled devices; 14 Table of Contents • our ability to achieve cost savings and improve yields and margins on our new and existing products; • our ability to successfully integrate into our business, and realize the expected benefits of, our acquisitions and strategic investments; and • our ability to utilize our capacity efficiently or to acquire additional capacity in response to customer demand.
Biggest changeOur future operating results will depend on many factors, including the following: • business and macroeconomic changes, including trade restrictions, foreign governments subsidizing local suppliers, recession or slowing growth in the semiconductor industry and the overall global economy; • political and/or civil unrest, acts of war or other military actions, including any resulting sanctions or other restrictive actions; • inflationary pressures, which vary across jurisdictions in which we do business, resulting in increased costs or reduced demand for our products due to increased prices of those products; • changes in consumer confidence caused by many factors, including changes in interest rates, credit markets, unemployment levels, energy or other commodity prices as well as changes in existing and expected rates of inflation; • fluctuations in demand for our customers’ products; • our ability to forecast our customers’ demand for our products accurately; • the ability of third-party foundries and other third-party suppliers to manufacture, assemble and test our products and otherwise deliver on their commitments to us in a timely and cost-effective manner; • our customers’ and distributors’ ability to manage the inventory that they hold and to forecast accurately their demand for our products; • delays in the widespread deployment and commercialization of new technologies; • our ability to achieve cost savings and improve yields and margins on our new and existing products; 14 Table of Contents • our ability to successfully integrate into our business, and realize the expected benefits of, our acquisitions and strategic investments; • our ability to disaggregate and divest elements of our business and realize the expected benefits of doing so; and • our ability to align production capacity to customer demand, which may lead to underutilization of our capacity in periods of lower demand or the lack of capacity in periods of excess demand.
However, these forecasts do not represent binding purchase commitments and we do not recognize sales for these products until they are shipped to or consumed by the customer. As a result, we incur significant inventory and manufacturing costs in advance of anticipated sales.
These forecasts, however, do not represent binding purchase commitments and we do not recognize sales for these products until they are shipped to, or consumed by, the customer. As a result, we incur significant inventory and manufacturing costs in advance of anticipated sales.
In order to compete effectively, we must hire and retain qualified employees, continue to develop leaders for key business units and functions, expand our presence in international locations and adapt to cultural norms of foreign locations and train and motivate our employee base.
We must hire and retain qualified employees, continue to develop leaders for key business units and functions, expand our presence in international locations, adapt to cultural norms of foreign locations and train and motivate our employee base in order to compete effectively.
Legislative changes, interpretations and guidance, and changes in prior tax rulings and decisions by tax authorities regarding treatments and positions of corporate income taxes resulting from these initiatives, could increase tax uncertainty, increase our effective tax rate, and result in taxes we previously paid being subject to change, which may adversely impact our financial position and results of operations.
Legislative changes, interpretations and guidance, and changes in prior tax rulings and decisions by tax authorities regarding treatments and positions of corporate income taxes resulting from these initiatives, could increase complexity and tax uncertainty, increase our effective tax rate and result in taxes we previously paid being subject to change, which may adversely impact our financial position and results of operations.
This requires us to work more closely with OEMs and ODMs to secure the design of our products in their handsets and other devices. Our relationships with chipset suppliers are complex and evolving, and the inability to effectively manage or maintain these relationships could have an adverse effect on our business, financial condition and results of operations.
This requires us to work more closely with OEMs and ODMs to secure the design of our products in their handsets and other devices. Our relationships with chipset suppliers are complex, and the inability to effectively manage or maintain these relationships could have an adverse effect on our business, financial condition and results of operations.
Our operating results have been and our future operating results could be adversely affected by one or more of the factors set forth above or other similar factors. If our future operating results are below the expectations of stock market analysts or our investors, our stock price may decline.
Our operating results have been and our future operating results could be adversely affected by one or more of the factors set forth above or other similar factors. If our future operating results or forecasts are below the expectations of stock market analysts or our investors, our stock price may decline.
We are subject to risks associated with environmental, health and safety regulations, including those related to climate change. We are subject to a broad array of U.S. and foreign environmental, health and safety laws and regulations.
We are subject to risks associated with social, environmental, health and safety regulations, including those related to climate change. We are subject to a broad array of U.S. and foreign social, environmental, health and safety laws and regulations.
ITEM 1A. RISK FACTORS. You should carefully consider the risks described below in addition to the other information contained in this report before making an investment decision with respect to any of our securities. Our business, financial condition or results of operations could be materially impacted by any of these risks.
ITEM 1A. RISK FACTORS. You should carefully consider the risks described below in addition to the other information contained in this report before making an investment decision with respect to any of our securities. Our business, financial condition or results of operations could be materially and adversely impacted by any of these risks.
Any disruptions from these events could require substantial expenditures and recovery time in order to fully resume operations and could also have a material adverse effect on our operations and financial results to the extent that losses are uninsured or exceed insurance recoveries and to the extent that such disruptions adversely impact our relationships with our customers.
Any disruptions from these events could require substantial expenditures and recovery time to fully resume operations and could also have a material adverse effect on our operations and financial results to the extent that losses are uninsured or exceed insurance recoveries, and to the extent that such disruptions adversely impact our relationships with our customers.
If demand for their products increases, our results are favorably impacted, while if demand for their products decreases, they may reduce their purchases of, or stop purchasing, our products and our operating results would suffer. Even if we achieve a design win, our customers can delay or cancel the release of a new handset for any reason.
If demand for their products increases, our results are favorably impacted, while if demand for their products decreases, they may reduce their purchases of, or stop purchasing our products and our operating results would suffer. Even if we achieve a design win, our customers can delay or cancel the release of a new device for any reason.
Risks Related to Intellectual Property, Information Technology and Data Privacy We rely on our intellectual property portfolio and may not be able to successfully protect against the use of our intellectual property by third parties. We rely on a combination of patents, trademarks, trade secret laws, confidentiality procedures and licensing arrangements to protect our intellectual property rights.
Risks Related to Intellectual Property, Cybersecurity, Information Technology and Data Privacy We rely on our intellectual property portfolio and may not be able to successfully protect against the use of our intellectual property by third parties. We rely on a combination of patents, trademarks, trade secret laws, confidentiality procedures and licensing arrangements to protect our IP rights.
Operating expenses and certain working capital items related to our foreign-based operations are, in some instances, denominated in the local foreign currencies and therefore are affected by changes in the U.S. dollar exchange rate in relation to foreign currencies, such as the Costa Rican Colon, Euro, Pound Sterling, Renminbi and Singapore Dollar.
Operating expenses and certain working capital items related to our foreign-based operations are, in some instances, denominated in the local foreign currencies and therefore are affected by changes in the U.S. dollar exchange rate in relation to foreign currencies, such as the Costa Rican Colon, Euro, Renminbi and Singapore Dollar.
The U.S. or foreign governments have taken and may continue to take administrative, legislative or regulatory action that could materially interfere with our ability to export, reexport, and transfer products and other items in certain countries, particularly in China.
The U.S. and foreign governments have taken and may continue to take administrative, legislative or regulatory action that could materially interfere with our ability to export, reexport, import and transfer products and other items to certain countries, particularly China.
These provisions include: • granting to the board of directors sole power to set the number of directors and fill any vacancy on the board of directors, whether such vacancy occurs as a result of an increase in the number of directors or otherwise; • the ability of the board of directors to designate and issue one or more series of preferred stock without stockholder approval, the terms of which may be determined at the sole discretion of the board of directors; • the inability of stockholders to call special meetings of stockholders; • establishment of advance notice requirements for stockholder proposals and nominations for election to the board of directors at stockholder meetings; and • the inability of stockholders to act by written consent.
These provisions include: • granting to the board of directors' sole power to set the number of directors and fill any vacancy on the board of directors, whether such vacancy occurs as a result of an increase in the number of directors or otherwise; • the ability of the board of directors to designate and issue one or more series of preferred stock without stockholder approval, the terms of which may be determined at the sole discretion of the board of directors; • the inability of stockholders to call special meetings of stockholders; • establishment of advance notice requirements for stockholder proposals and nominations for election to the board of directors at stockholder meetings; and 29 Table of Contents • the inability of stockholders to act by written consent.
Costs of product defects and deviations from required specifications include the following: • writing off inventory; • scrapping products that cannot be reworked; • accepting returns of products that have been shipped; • providing product replacements at no charge; • reimbursement of direct and indirect costs incurred by our customers in recalling or reworking their products due to defects in our products; • travel and personnel costs to investigate potential product quality issues and to identify or confirm the failure mechanism or root cause of product defects; and • defending against litigation.
Costs of product defects and deviations from required specifications can include the following: • writing off inventory; 18 Table of Contents • scrapping products that cannot be reworked; • accepting returns of products that have been shipped; • providing product replacements at no charge; • reimbursement of direct and indirect costs incurred by our customers in recalling or reworking their products due to defects in our products; • travel and personnel costs to investigate potential product quality issues and to identify or confirm the failure mechanism or root cause of product defects; and • defending against litigation.
The imposition by the U.S. of tariffs on goods imported from China, countermeasures imposed by China in response, U.S. export restrictions on sales of products to China and other government actions that restrict or otherwise adversely affect our ability to sell our products to Chinese customers may have a material impact on our business, including our ability to sell products and to manufacture or source components.
The imposition by the U.S. of tariffs on goods imported from China, countermeasures imposed by China in response, U.S. export restrictions on sales of products to China and other government actions that restrict or otherwise adversely affect our ability to sell our products to customers in China may have a material adverse impact on our business, including our ability to sell products and to manufacture or source components and materials.
In addition, existing or new immigration laws, policies or regulations in the U.S. may limit the pool of available talent. Travel bans, difficulties obtaining visas and other restrictions on international travel could make it more difficult to effectively manage our international operations, operate as a global company or service our international customer base.
In addition, existing or new immigration laws, policies or regulations in the U.S. may limit the pool of available talent. Difficulties obtaining visas and other restrictions on international travel could make it more onerous to effectively manage our international operations, operate as a global company or service our international customer base.
Operating results below current levels or other adverse factors, including a significant increase in interest rates, could result in our being unable to comply with the financial covenants contained in our revolving facility.
Operating results below current levels or other adverse factors, including a significant increase in interest rates, could result in our being unable to comply with the financial covenant contained in our revolving facility.
Changes in our effective tax rate may adversely impact our results of operations. We are subject to taxation in China, Germany, Singapore, the U.S. and numerous other foreign jurisdictions.
Changes in our effective tax rate may adversely impact our results of operations and cash flow. We are subject to taxation in China, Germany, Singapore, the U.S. and numerous other foreign jurisdictions.
Any of these risks could have a material adverse effect on our business, results of operations, financial condition, or cash flows, particularly in the case of a large acquisition. In order to compete, we must attract, retain, and motivate key employees, and our failure to do so could harm our business and our results of operations.
Any of these risks could have a material adverse effect on our business, results of operations, financial condition, or cash flows, particularly in the case of a large acquisition. 21 Table of Contents We must attract, retain, and motivate key employees in order to compete, and our failure to do so could harm our business and our results of operations.
We cannot guarantee that third parties and infrastructure in our supply chain or our partners’ supply chains have not been compromised or that they do not contain exploitable defects or bugs that could result in a breach of or disruption to our information technology systems, including our products and services, or the third-party information technology systems that support our services.
We cannot guarantee that third parties and infrastructure in our supply chain or our partners’ supply chains have not been compromised or that they do not contain exploitable defects or bugs that could result in a breach of or disruption to our IT systems, including our products and services, or the third-party IT systems that support our services.
Our competitors may also be able to design around our patents. The laws of some countries in which our products are developed, manufactured or sold may not protect our products or intellectual property rights to the same extent as U.S. laws. This increases the possibility of misappropriation or infringement of our technology and products.
Our competitors may also be able to design around our patents. The laws of some countries in which our products are developed, manufactured or sold may not protect our products or IP rights to the same extent as U.S. laws. This increases the possibility of misappropriation or infringement of our technology and products.
Our operating results may be adversely affected if third parties were to assert claims that our products infringed their patent, copyright or other intellectual property rights. Such assertions could lead to expensive and unpredictable litigation, diverting the attention of management and technical personnel.
Our operating results may be adversely affected if third parties were to assert claims that our products infringed their patent, copyright or other IP rights. Such assertions could lead to expensive and unpredictable litigation, diverting the attention of management and technical personnel.
Moreover, our resources are limited and our decision to pursue a transaction has opportunity costs; accordingly, if we pursue a particular transaction, we may need to forgo the prospect of entering into other transactions that could 21 Table of Contents help us achieve our financial or strategic objectives.
Moreover, our resources are limited and our decision to pursue a transaction has opportunity costs; accordingly, if we pursue a particular transaction, we may need to forgo the prospect of entering into other transactions that could help us achieve our financial or strategic objectives.
The credit agreement governing our revolving facility and term loan and the indentures governing our senior notes contain a number of significant restrictions and covenants that limit our ability to: • incur additional debt; • pay dividends, make other distributions or repurchase or redeem our capital stock; • prepay, redeem or repurchase certain debt; • make loans and investments; • sell, transfer or otherwise dispose of assets; • incur or permit to exist certain liens; • enter into certain types of transactions with affiliates; • enter into agreements restricting our subsidiaries’ ability to pay dividends; and • consolidate, amalgamate, merge or sell all or substantially all of our assets.
The credit agreement governing our revolving facility and the indentures governing our senior notes contain a number of significant restrictions and covenants that limit our ability to: • incur additional debt; 26 Table of Contents • pay dividends, make other distributions or repurchase or redeem our capital stock; • prepay, redeem or repurchase certain debt; • make loans and investments; • sell, transfer or otherwise dispose of assets; • incur or permit to exist certain liens; • enter into certain types of transactions with affiliates; • enter into agreements restricting our subsidiaries’ ability to pay dividends; and • consolidate, amalgamate, merge or sell all or substantially all of our assets.
Furthermore, the COVID-19 pandemic and related supply chain disruptions and labor market constraints have created heightened risk that external suppliers may be unable to meet their obligations to us. If we experience any significant difficulty in obtaining the materials or services used in the conduct of our business, these supply challenges may limit our ability to fully satisfy customer demand.
Furthermore, supply chain disruptions and labor market constraints have created heightened risk that external suppliers may be unable to meet their obligations to us. If we experience any significant difficulty in obtaining the materials or services used in the conduct of our business, these supply challenges may limit our ability to fully satisfy customer demand.
Any loss of such information could harm our competitive position, result in a loss of customer confidence in the adequacy of our threat mitigation and detection processes and procedures, cause us to incur significant costs to remedy the damages caused by the incident, and divert management and other resources.
Any misappropriation could harm our competitive position, result in a loss of customer confidence in the adequacy of our threat mitigation and detection processes and procedures, cause us to incur significant costs to remedy the damages caused by the incident and divert management and other resources.
We routinely implement improvements to our network security safeguards and we are devoting increasing resources to the security of our information technology systems. We cannot, however, assure that such system improvements will be sufficient to prevent or limit the damage from any future cyber-attack or network disruptions.
We routinely implement improvements to our network security safeguards and we are devoting increasing resources to the security of our IT systems. We cannot, however, assure that such system improvements will be sufficient to prevent or limit the damage from any future cyber-attack or network disruptions.
Our effective tax rate is subject to fluctuations and impacted by a number of factors, including the following: • changes in our overall profitability and the amount of profit determined to be earned and taxed in jurisdictions with differing statutory tax rates; • the resolution of issues arising from tax audits with various tax authorities, including those described in Note 13 of the Notes to Consolidated Financial Statements; • changes in the valuation of either our gross deferred tax assets or gross deferred tax liabilities; • adjustments to income taxes upon finalization of various tax returns; 22 Table of Contents • changes in expenses not deductible for tax purposes; • changes in available tax credits; and • changes in tax laws, domestic and foreign, or the interpretation of such tax laws, and changes in generally accepted accounting principles.
Our effective tax rate is subject to fluctuations and impacted by a number of factors, including the following: • changes in our overall profitability and the amount of profit determined to be earned and taxed in jurisdictions with differing statutory tax rates; • changes in our operating structure, strategy and investment decisions; • the resolution of issues arising from tax audits with various tax authorities, including those described in Note 14 of the Notes to Consolidated Financial Statements; • changes in the valuation of either our gross deferred tax assets or gross deferred tax liabilities; 22 Table of Contents • adjustments to income taxes upon finalization of various tax returns; • changes in expenses not deductible for tax purposes; • changes in available tax credits; and • changes in tax laws, domestic and foreign, or the interpretation of such tax laws and changes in generally accepted accounting principles.
Labor is further subject to external factors that are beyond our control, including our industry's highly competitive market for skilled workers and leaders, cost inflation, the COVID-19 pandemic and workforce participation rates. Our future operating results and success depend on keeping key technical personnel and management and expanding our sales and marketing, R&D and administrative support.
Labor is further subject to external factors that are beyond our control, including our industry's highly competitive market for skilled workers and leaders, cost inflation and workforce participation rates. Our future operating results and success depend on keeping key technical personnel and management and expanding our sales and marketing, R&D and administrative support.
Some of the factors that could cause fluctuations in the stock price or trading volume of our common stock include: • general market and economic and political conditions, including market conditions in the semiconductor industry; • actual or expected variations in quarterly operating results; • pandemics and similar major health concerns, including the COVID-19 pandemic; • differences between actual operating results and those expected by investors and analysts; • changes in recommendations by securities analysts; • operations and stock performance of competitors and major customers; • accounting charges, including charges relating to the impairment of goodwill and restructuring; 29 Table of Contents • significant acquisitions, strategic alliances, capital commitments, or new products announced by us or by our competitors; • differences, whether actual or perceived, between our corporate social responsibility and ESG practices and disclosure and investor expectations; • sales of our common stock, including sales by our directors and officers or significant investors; • repurchases of our common stock; • recruitment or departure of key personnel; and • loss of key customers.
Some of the factors that could cause fluctuations in the stock price or trading volume of our common stock include: • general market and economic and political conditions, including market conditions in the semiconductor industry; • actual or expected variations in quarterly operating results; • pandemics, such as the COVID-19 pandemic and similar major health concerns; • differences between actual operating results and those expected by management, investors and analysts; • changes in recommendations by securities analysts, social media or press; • operations and stock performance of competitors and major customers; • accounting charges, including charges relating to the impairment of goodwill and restructuring; • significant acquisitions, strategic alliances, capital commitments, or new products announced by us or by our competitors; • differences, whether actual or perceived, between our corporate social responsibility and ESG practices and disclosure and investor expectations; • sales of our common stock, including sales by our directors and officers or significant investors; • repurchases of our common stock; • recruitment or departure of key personnel; and • loss of key customers.
These covenants could have the effect of limiting our flexibility in planning for or reacting to changes in our business and the markets in which we compete. In addition, our credit agreement requires us to comply with certain financial maintenance covenants.
These covenants could have the effect of limiting our flexibility in planning for or reacting to changes in our business and the markets in which we compete. In addition, our credit agreement requires us to comply with a financial maintenance covenant.
The use of external suppliers involves a number of risks, including the possibility of material disruptions in the 16 Table of Contents supply of key components and the lack of control over delivery schedules, capacity constraints, manufacturing yields, product quality and cost increases.
The use of external suppliers involves a number of risks, including the possibility of material disruptions in the supply of key components and the lack of control over delivery schedules, capacity constraints, manufacturing yields, product quality and cost increases.
Our worldwide operations and business could be, and in some cases have been, disrupted by natural disasters, industrial accidents, cybersecurity incidents, telecommunications failures, power or water shortages, extreme weather conditions, public health issues (including the COVID-19 pandemic), terrorist attacks, political and/or civil unrest, acts of war or other military actions, political or regulatory issues and other man-made disasters or catastrophic events.
Our worldwide operations and business could be, and in some cases have been, disrupted by natural disasters, industrial accidents, cybersecurity incidents, telecommunications failures, power or water shortages, extreme weather conditions, public health issues (including pandemics such as COVID-19), terrorist attacks, political and/or civil unrest, acts of war or other military actions, political or regulatory issues and other man-made disasters or catastrophic events.
In addition, other countries are beginning to implement legislation and other guidance to align their international tax rules with the Organisation for Economic Co-operation and Development’s Base Erosion and Profit Shifting recommendations and action plan, which aim to standardize and modernize global corporate tax policy, including changes to cross-border tax, transfer pricing documentation rules, nexus-based tax incentive practices, allocating greater taxing rights to countries where customers are located, and establishing a minimum tax on global income.
In addition, other countries in which we operate are beginning to implement legislation and other guidance to align their international tax rules with the Organization for Economic Co-operation and Development’s Base Erosion and Profit Shifting recommendations and action plan, which aim to standardize and modernize global corporate tax policy, including changes to cross-border tax, transfer pricing documentation rules, nexus-based tax incentive practices, allocating greater taxing rights to countries where customers are located and establishing a minimum tax of 15% on global income.
In addition, if one of our customers or another supplier to one of our customers were found to be infringing on third-party intellectual property rights, such a finding could adversely affect the demand for our products.
In addition, if one of our customers or another supplier to one of our customers were found to be infringing on third-party IP rights, such a finding could adversely affect the demand for our products.
However, even with supply agreements, we are still subject to risks that a supplier will be unable to meet its supply commitments, achieve anticipated manufacturing yields, produce wafers on a timely basis, or provide additional wafer capacity beyond its current contractual commitments sufficient to meet our supply needs.
However, even with supply agreements, we are still subject to risks that a supplier will be unable to meet its supply commitments, achieve anticipated manufacturing yields, produce wafers or other components on a timely basis, or provide additional capacity beyond contractual commitments sufficient to meet our supply needs.
As a result, we are subject to regulatory, geopolitical and other risks associated with doing business outside the U.S., including: • global and local economic, social and political conditions and uncertainty; • currency controls and currency exchange rate fluctuations; • inflation, as well as changes in existing and expected rates of inflation, which vary across the jurisdictions in which we do business; • formal or informal imposition of export, import or doing-business regulations, including trade sanctions, tariffs and other related restrictions; • labor market conditions and workers’ rights affecting our manufacturing operations or those of our customers or suppliers; • disruptions in capital and securities and commodities trading markets; • occurrences of geopolitical crises such as terrorist activity, armed conflict, civil or military unrest or political instability such as the conflict in Ukraine, which may disrupt manufacturing, assembly, logistics, security and communications and result in reduced demand for our products; • compliance with laws and regulations that differ among jurisdictions, including those covering taxes, intellectual property ownership and infringement, imports and exports, anti-corruption and anti-bribery, antitrust and competition, data privacy, and environment, health, and safety; • markets for 5G infrastructure not developing in the manner or in the time periods we anticipate, including as a result of unfavorable developments with evolving laws and regulations worldwide; and 24 Table of Contents • pandemics and similar major health concerns, including COVID-19 and related mitigation actions (such as the recent lockdowns in China), which could adversely affect our business and our customer order patterns.
As a result, we are subject to regulatory, geopolitical and other risks associated with doing business outside the U.S., including: • global and local economic, social and political conditions and uncertainty; • currency controls and currency exchange rate fluctuations; • inflation, as well as changes in existing and expected rates of inflation, which vary across the jurisdictions in which we do business; 24 Table of Contents • formal or informal imposition of export, import or doing-business regulations, including trade sanctions, tariffs and other related restrictions; • labor market conditions and workers’ rights affecting our manufacturing operations or those of our customers or suppliers; • disruptions in capital and securities and commodities trading markets; • occurrences of geopolitical crises such as terrorist activity, armed conflict, civil or military unrest or political instability, or global hostilities such as the war in Ukraine and the ongoing conflict in the Middle East, may disrupt manufacturing, assembly, logistics, security and communications and result in reduced demand for our products; • compliance with laws and regulations that differ among jurisdictions, including those covering taxes, IP ownership and infringement, imports and exports, anti-corruption and anti-bribery, antitrust and competition, cybersecurity, data privacy, and social, environment, health, and safety; • markets for 5G infrastructure not developing in the manner or in the time periods we anticipate, including as a result of unfavorable developments with evolving laws and regulations worldwide; and • pandemics and similar major health concerns, which could adversely affect our business and our customer order patterns.
Risk Factors Summary The following is a summary of the principal risks that could adversely affect our business, financial condition or results of operations. • Our operating results fluctuate and are substantially dependent on developing new products and achieving design wins as our customers' requirements can change rapidly and product life cycles can be short. • We depend on several large customers for a substantial portion of our revenue and the loss of one or more of these customers could have a material adverse effect on our business, financial condition and results of operations. • We face risks of a loss of revenue if contracts with the United States government or defense and aerospace contractors are canceled or delayed or if defense spending is reduced. • We may be subject to continued volatility and uncertainty in customer demand, worldwide economies and financial markets resulting from the ongoing impact of the COVID-19 pandemic. • We depend heavily on third parties. • We face risks related to sales through distributors. • We face risks associated with the operation of our manufacturing facilities, and if we experience poor manufacturing yields, our operating results may suffer. • We are subject to inventory risks and costs because we purchase materials and build our products based on forecasts provided by customers before receiving purchase orders for the products. 13 Table of Contents • We sell certain of our products based on reference designs of chipset suppliers, and our inability to effectively manage or maintain our evolving relationships with these companies may have an adverse effect on our business. • We are subject to risks from international sales and operations. • We may not be able to generate sufficient cash to service all of our debt or to fund capital expenditures and may be forced to take other actions to satisfy our debt obligations and financing requirements, which may not be successful or on terms favorable to us. • Our acquisitions and other strategic investments could fail to achieve our financial or strategic objectives, disrupt our ongoing business, and adversely impact our results of operations. • In order to compete, we must attract, retain, and motivate key employees, and our failure to do so could harm our business and our results of operations. • We rely on our intellectual property portfolio and may not be able to successfully protect against the use of our intellectual property by third parties, and we may be subject to claims of infringement of third-party intellectual property rights. • Security breaches and other disruptions could compromise our proprietary information, expose us to liability or disrupt our ability to operate critical business functions, which would cause our business and reputation to suffer.
Risk Factors Summary The following is a summary of the principal risks that could adversely affect our business, financial condition or results of operations. • Our operating results fluctuate and are substantially dependent on developing new products and achieving design wins as our customers' requirements can change rapidly and product life cycles can be short. • We depend on several large customers for a substantial portion of our revenue and the loss of one or more of these customers could have a material adverse effect on our business, financial condition and results of operations. • We face risks of a loss of revenue if contracts with the United States government or defense and aerospace contractors are canceled or delayed or if defense spending is reduced. • We depend heavily on third parties. • We face risks related to sales through distributors. • We face risks associated with the operation of our manufacturing facilities, and if we experience poor manufacturing yields, our operating results may suffer. • We are subject to inventory risks and costs because we purchase materials and build our products based on forecasts provided by customers before receiving purchase orders for the products. • We sell certain of our products based on reference designs of chipset suppliers, and our inability to effectively manage or maintain relationships with these companies may have an adverse effect on our business. • Overcapacity could cause us to underutilize our manufacturing facilities and have a material adverse effect on our financial performance. • We are subject to risks from international sales and operations. 13 Table of Contents • We may not be able to generate sufficient cash to service all of our debt or to fund capital expenditures and may be forced to take other actions to satisfy our debt obligations and financing requirements, which may not be successful or on terms favorable to us. • Our acquisitions and other strategic investments could fail to achieve our financial or strategic objectives, disrupt our ongoing business and adversely impact our results of operations. • We must attract, retain, and motivate key employees in order to compete, and our failure to do so could harm our business and our results of operations. • We rely on our IP portfolio and may not be able to successfully protect against the use of our IP by third parties, and we may be subject to claims of infringement of third-party IP rights. • Security breaches and other disruptions to our IT systems, or other misappropriation of proprietary information, could expose us to liability or disrupt our ability to operate critical business functions, which would cause our business and reputation to suffer.
For a more complete discussion of the material risks facing our business, see below. Risks Related to Our Business and Industry Our operating results fluctuate. Our revenue, earnings, margins and other operating results have fluctuated significantly in the past and may fluctuate significantly in the future.
For a more complete discussion of the material risks facing our business, see below. Risks Related to Our Business and Industry Our operating results fluctuate on a quarterly and annual basis. Our revenue, earnings, margins and other operating results have fluctuated significantly in the past and may fluctuate significantly in the future .
We operate in a very competitive industry and must continue to innovate. We compete with several companies primarily engaged in the business of designing, manufacturing and selling RF solutions, as well as suppliers of discrete integrated circuits and modules.
We operate in a very competitive industry and must continue to innovate. We compete with companies primarily engaged in the business of designing, manufacturing and selling RF solutions, as well as suppliers of discrete ICs and modules.
Using third parties for distribution exposes us to many risks, including competitive pressure, concentration, credit risk, and compliance risks. Other third parties may use one of our distributors to sell products that compete with our products, and we may need to provide financial and other incentives to the distributors to focus them on the sale of our products.
Using third parties for distribution exposes us to many risks, including competitive pressure, concentration, credit risk and compliance risks. Other third parties may use one of our distributors to sell products that compete with our products, and we may need to incentivize the distributors to focus on the sale of our products.
The number of usable products that result from our production process can fluctuate as a result of many factors, including: • design errors; 18 Table of Contents • defects in photomasks (which are used to print circuits on a wafer); • minute impurities and variations in materials used; • contamination of the manufacturing environment; • equipment failure or variations in the manufacturing processes; • losses from broken wafers or other human error; and • defects in substrates and packaging.
The number of usable products that result from our production process can fluctuate as a result of many factors, including: • design errors; • defects in photomasks (which are used to print circuits on a wafer); • minute impurities and variations in materials used; • contamination of the manufacturing environment; • equipment failure or variations in manufacturing processes; • losses arising from human error; and • defects in substrates and packaging.
Because the techniques used by computer hackers and others to access or sabotage networks constantly evolve and generally are not recognized until launched against a target, we may be unable to anticipate, counter or ameliorate all of these techniques.
Because the techniques used by computer hackers and others to access or sabotage networks constantly evolve and generally are not recognized until launched against a target, we may be unable to anticipate, detect, or counter all of these techniques or identify all security vulnerabilities.
If we violate covenants under our credit agreement and are unable to obtain a 26 Table of Contents waiver from our lenders, our debt under our revolving facility would be in default and could be accelerated by our lenders.
If we violate covenants under our credit agreement and are unable to obtain a waiver from our lenders, our debt under our revolving facility would be in default and could be accelerated by our lenders.
In 2017, the U.S. enacted comprehensive tax legislation, commonly referred to as the Tax Cuts and Jobs Act (the "Tax Act"), which included a number of changes to U.S. tax laws that impacted us, including the one-time transition tax on certain unrepatriated earnings of foreign subsidiaries (the "Transitional Repatriation Tax") and the Global Intangible Low-Taxed Income ("GILTI") provisions.
In 2017, the U.S. enacted comprehensive tax legislation, commonly referred to as the Tax Cuts and Jobs Act, which included a number of changes to U.S. tax laws that impacted us, including the one-time transition tax on certain unrepatriated earnings of foreign subsidiaries (the "Transitional Repatriation Tax") and the Global Intangible Low-Taxed Income ("GILTI") provisions, for which a 50% deduction is currently permitted subject to certain limitations.
Acquisitions and strategic investments also entail numerous other risks that could adversely affect our business, results of operations and financial condition, including: • failure to complete a transaction in a timely manner, if at all, due to our inability to obtain required government or other approvals, IP disputes or other litigation, difficulty in obtaining financing on terms acceptable to us, or other unforeseen factors; • controls, processes, and procedures of an acquired business may not adequately ensure compliance with laws and regulations, and we may fail to identify compliance issues or liabilities; • unanticipated costs, capital expenditures or working capital requirements; • acquisition-related charges and amortization of acquired technology and other intangibles; • the potential loss of key employees from a company we acquire or in which we invest; • diversion of management’s attention from our business; • disruption of our ongoing operations; • dis-synergies or other harm to existing business relationships with suppliers and customers; • losses or impairment of investments from unsuccessful research and development by companies in which we invest; • failure to successfully integrate acquired businesses, operations, products, technologies and personnel; and • unrealized expected synergies.
Acquisitions, divestitures and strategic investments also entail numerous other risks that could adversely affect our business, results of operations and financial condition, including: • failure to complete a transaction in a timely manner, if at all, due to our inability to obtain required government or other approvals, IP disputes or other litigation, difficulty in obtaining financing on terms acceptable to us, or other unforeseen factors; • controls, processes and procedures of an acquired business may not adequately ensure compliance with laws and regulations, and we may fail to identify compliance issues or liabilities; • unanticipated costs, capital expenditures or working capital requirements; • transaction-related charges and amortization of acquired technology and other intangibles; • the potential loss of key employees from a company we acquire or in which we invest; • diversion of management’s attention from our business; • disruption of our ongoing operations; • dis-synergies or other harm to existing business relationships with suppliers and customers; • losses or impairment of investments from unsuccessful research and development by companies in which we invest; • impairment of acquired intangible assets, goodwill or other assets as a result of changing business conditions or technological advancements; • failure to successfully integrate or divest businesses, operations, products, technologies and personnel; • slower than expected market adoption or attach rates for any of our new technologies; and • unrealized expected synergies.
Even when a design win is achieved, our success is not assured. Design wins may require significant expenditures by us and typically precede a higher volume revenue by six to nine months or more. Many customers seek a second source for all major components in their devices, which can significantly reduce the revenue obtained from a design win.
Even when a design win is achieved, our success is not assured. Design wins may require significant expenditures by us before realizing revenue six to nine months or more later. Many customers seek a second source for all major components in their devices, which can significantly reduce the revenue obtained from a design win.
A substantial portion of our MP revenue is currently from several large customers. Our future operating results will be affected by both the success of our largest customers and on our success in diversifying our products and customer base.
A substantial portion of our revenue comes from several large customers. Our future operating results will be affected by both the success of our largest customers and our success in diversifying our products and customer base.
Our ability to monitor these third parties’ information security practices is limited, and these may not have adequate information security measures in place.
Our ability to identify all security vulnerabilities and monitor these third-parties’ information security practices is limited, and these third parties may not have adequate information security measures in place.
Sales to customers located outside the U.S. accounted for approximately 58% of our revenue in fiscal 2022, of which approximately 32% was attributable to sales to customers located in China. We expect that revenue from international sales to China and other markets will continue to be a significant part of our total revenue.
Sales to customers located outside the U.S. accounted for approximately 42% of our revenue in fiscal 2024, of which approximately 19% was attributable to sales to customers located in China. We expect revenue from international sales to China and other markets will continue to be a significant part of our total revenue.
A number of factors related to our facilities will affect our business and financial results, including the following: • our ability to adjust production capacity in a timely fashion in response to changes in demand for our products; • the significant fixed costs of operating the facilities; • factory utilization rates; • our ability to qualify our facilities for new products and new technologies in a timely manner; 17 Table of Contents • the availability of raw materials, the impact of the volatility of commodity pricing and tariffs imposed on raw materials, including substrates, gold, platinum and high purity source materials such as gallium, aluminum, arsenic, indium, silicon, phosphorous and palladium; • our manufacturing cycle times; • our manufacturing yields; • the political, regulatory and economic risks associated with our international manufacturing operations; • potential violations by our international employees or third-party agents of international or U.S. laws relevant to foreign operations; • our ability to hire, train and manage qualified production personnel; • our compliance with applicable environmental and other laws and regulations; and • our ability to avoid prolonged periods of down-time in our facilities for any reason, including but not limited to, COVID-19.
A number of factors related to our facilities will affect our business and financial results, including the following: • our ability to adjust production capacity in a timely fashion, including the migration of production amongst our various factories, in response to changes in demand for our products; • the significant fixed costs of operating the facilities; • factory utilization rates; • our ability to qualify our facilities for new products and new technologies in a timely manner; • the availability of raw materials, the impact of the volatility of commodity pricing and tariffs imposed on raw materials, including substrates, gold, platinum and high-purity source materials such as gallium, aluminum, arsenic, indium, silicon, phosphorous and palladium; • our manufacturing cycle times; • our manufacturing yields; • the political, regulatory and economic risks associated with our international manufacturing operations; • potential violations by our employees or third-party agents of international or U.S. laws relevant to foreign operations; • our ability to hire, train and manage qualified production personnel; • our compliance with applicable environmental and other laws and regulations, as well as our ability to satisfy our customers' environmental initiatives for their supply chains; and • our ability to avoid prolonged periods of down-time in our facilities for any reason. 17 Table of Contents Business disruptions could harm our business, lead to a decline in revenue and increase our costs.
Furthermore, we rely on products and services provided by third-party suppliers to operate certain critical business systems, including without limitation, cloud-based infrastructure, encryption and authentication technology, employee email, and other functions, which exposes us to supply-chain attacks or other business disruptions.
F urthermore, we rely on products and services provided by third-party suppliers, which may include open-source code, to operate certain critical business systems, including without limitation, cloud-based infrastructure, encryption and authentication technology, employee email and other functions, which exposes us to supply chain attacks or other business disruptions.
Our failure to comply with any of these existing or future laws or regulations could result in: • regulatory penalties and fines; • legal liabilities, including financial responsibility for remedial measures if our properties are contaminated; • expenses to secure required permits and governmental approvals; • reputational damage; • suspension or curtailment of our manufacturing, assembly and test processes; and • increased costs to acquire pollution abatement or remediation equipment or to modify our equipment, facilities or manufacturing processes to bring them into compliance with applicable laws and regulations. 23 Table of Contents Existing and future environmental laws and regulations could also impact our product designs and limit or restrict the materials or components that are included in our products.
Our failure to comply with any of these existing or future laws or regulations could result in: • regulatory penalties and fines; • legal liabilities, including financial responsibility for remedial measures if our properties are contaminated; • expenses to secure required permits and governmental approvals; • reputational damage; • suspension or curtailment of our manufacturing, assembly and test processes; and • increased costs to acquire pollution abatement or remediation equipment or to modify our equipment, facilities or manufacturing processes to bring them into compliance with applicable laws and regulations.
Generally, intellectual property litigation is both expensive and unpredictable. Our involvement in intellectual property litigation could divert the attention of our management and technical personnel and have a material, adverse effect on our business. We may be subject to claims of infringement of third-party intellectual property rights.
Our involvement in IP litigation could divert the attention of our management and technical personnel and have a material, adverse effect on our business. 27 Table of Contents We may be subject to claims of infringement of third-party intellectual property rights.
Although we intend to vigorously defend our intellectual property rights, we may not be able to prevent misappropriation of our technology. Additionally, our competitors may be able to independently develop non-infringing technologies that are substantially equivalent or superior to ours. We may need to engage in legal actions to enforce or defend our intellectual property rights.
Although we intend to vigorously defend our IP rights, we may not be able to prevent misappropriation of our technology. Additionally, our competitors may be able to independently develop non-infringing technologies that are substantially equivalent or superior to ours.
See Note 11 of the Notes to Consolidated Financial Statements for additional information. Because demand for our products may not materialize, or may be lower than expected, purchasing materials and manufacturing based on forecasts subjects us to heightened risks of higher inventory carrying costs, increased obsolescence and higher operating costs.
Because demand for our products may not materialize, or may be lower than expected, purchasing materials and manufacturing based on forecasts subjects us to heightened risks of higher inventory carrying costs, increased obsolescence, and higher operating costs.
Additionally, our credit agreement and the indentures governing our senior notes limit the use of the proceeds from any disposition; as a result, we may not be allowed under these documents to use proceeds from such dispositions to satisfy our debt service obligations.
These alternative measures may not be successful and may not permit us to meet our scheduled debt service and other obligations. Additionally, the indentures governing our senior notes limit the use of the proceeds from any disposition; as a result, we may not be allowed under these documents to use proceeds from such dispositions to satisfy our debt service obligations.
We sell a significant portion of our products through third-party distributors. We depend on these distributors to help us create end customer demand, provide technical support and other value-added services to customers, fill customer orders, and stock our products.
We depend on these distributors to help us create end customer demand, provide technical support and other value-added services to customers, fill customer orders and stock our products.
These laws and regulations include those related to the use, transportation, storage, handling, emission, discharge and recycling or disposal of hazardous materials used in our manufacturing, assembly and testing processes.
Environmental laws and regulations include those related to the use, transportation, storage, handling, emission, discharge and recycling or disposal of hazardous materials used in our manufacturing, assembly and testing processes. Additional laws and regulations include those related to human rights and supply chain due diligence.
In some cases, product designs we pursue represent either opportunities to substantially increase our revenue by winning a new design or a risk of a substantial decrease in revenue by losing a product on which we are the incumbent.
Our largest customers typically refresh some or all of their product portfolios by releasing new models each year. In some cases, product designs we pursue represent either opportunities to substantially increase our revenue by winning a new design or a risk of a substantial decrease in revenue by losing a product on which we are the incumbent.
Underutilization of our manufacturing facilities can adversely affect 20 Table of Contents our gross margin and other operating results. If demand for our products experiences a prolonged decrease, we may be required to close or idle facilities and write down our long-lived assets or shorten the useful lives of underutilized assets and accelerate depreciation, which would increase our expenses.
If demand for our products experiences a prolonged decrease, we may be required to close or idle facilities and write down our long-lived assets or shorten the useful lives of underutilized assets and accelerate depreciation, which would increase our expenses.
For many years, the Chinese economy has experienced periods of rapid growth and wide fluctuations in the rate of inflation. In response to these factors, the Chinese government has, from time to time, adopted measures to regulate growth and to contain inflation, including currency controls and measures designed to restrict credit, control prices or set currency exchange rates.
In response to these factors, the Chinese government has, from time to time, adopted measures to regulate growth and to contain inflation, including currency controls and measures designed to restrict credit, control prices or set currency exchange rates.
Failure to meet GDPR requirements could result in penalties of up to 4% of worldwide revenue. In addition, the interpretation and application of consumer and data protection laws in the U.S., Europe and elsewhere are often uncertain and fluid, and may be interpreted and applied in a manner that is inconsistent with our data practices.
In addition, the interpretation and application of consumer and data protection laws in the U.S., Europe and elsewhere are often uncertain and fluid and may be interpreted and applied in a manner that is inconsistent with our data practices.
In addition, many of our largest end customers require us to comply with corporate social responsibility policies, which often include employment, health, safety, environmental and other requirements that exceed applicable legal requirements.
In addition, many of our largest end customers require companies within their supply chain to comply with corporate social responsibility policies that exceed applicable legal requirements, and often include employment, human rights, health, safety, and environmental initiatives.
This market dynamic has evolved as chipset suppliers have worked to develop more fully integrated solutions that include their own RF technologies and components. Chipset suppliers may be in a different business from ours or we may be their customer or direct competitor. Accordingly, we must balance our interest in obtaining new business with competitive and other factors.
This market dynamic has evolved as chipset suppliers have worked to develop more fully integrated solutions that include their own RF technologies and components. 19 Table of Contents Chipset suppliers may be in a different business from ours or we may be their customer or direct competitor.
Collectively, our two largest end customers accounted for an aggregate of approximately 44%, 39% and 43% of our revenue for fiscal years 2022, 2021 and 2020, respectively.
Collectively, our two largest end customers accounted for an aggregate of approximately 58%, 49% and 44% of our revenue for fiscal years 2024, 2023 and 2022, respectively.
The U.S. government has in the past imposed export restrictions that effectively banned American companies from exporting, reexporting, and transferring products to certain of our customers. If such restrictions are imposed again in the future and even if subsequently lifted, any financial or other penalties could have a continuing negative impact on our future revenue and results of operations.
The U.S. government has in the past imposed export restrictions that effectively banned American companies from exporting, reexporting, and transferring products to certain of our customers, and imposed significant restrictions on the ability to obtain export licenses for our products. Such restrictions could have a continuing negative impact on our future revenue and results of operations.
Our acquisitions and other strategic investments could fail to achieve our financial or strategic objectives, disrupt our ongoing business, and adversely impact our results of operations.
Our acquisitions, divestitures and other strategic investments could fail to achieve our financial or strategic objectives, disrupt our ongoing business and adversely impact our results of operations. As part of our business strategy, we expect to continue to review potential acquisitions, divestitures and strategic investments.
Any weakness in the Chinese economy could result in a decrease in demand for consumer products that contain our products, which could materially and adversely affect our business.
Any weakness in the Chinese economy, heightened tensions between the U.S. and China, China and Taiwan, or other countries, could result in a decrease in demand for consumer products that contain our products, which could materially and adversely affect our business.
We currently use several international and domestic assembly suppliers, as well as internal assembly facilities in China, Costa Rica, Germany and the U.S., to assemble and test our products.
We use several international and domestic assembly suppliers, as well as internal assembly facilities in Costa Rica, Germany and the U.S., to assemble and test our products. We currently have our own test and tape and reel facilities located in Costa Rica and the U.S., and we also utilize contract suppliers and partners in Asia.
As the semiconductor industry continued to experience supply constraints for certain items during fiscal 2022, we have entered into certain supply agreements to address short- and long-term supply requirements.
As the semiconductor industry may experience supply constraints for certain items, from time to time, we enter into certain supply agreements to address short-term and long-term supply requirements.
We have foreign operations in Asia, Europe and Central America, and a substantial portion of our revenue is derived from sales to customers outside the U.S. Our international revenue is primarily denominated in U.S. dollars.
We have foreign operations in Asia, Europe and Central America. Our international revenue is primarily denominated in U.S. dollars.
Our operating results are substantially dependent on developing new products and achieving design wins as our customers' requirements can change rapidly and product life cycles can be short.
Our operating results are substantially dependent on developing new products and achieving design wins while our customers' requirements can change rapidly and product life cycles can be short. Our largest markets are characterized by the frequent introduction of new products in response to evolving product requirements.
If the U.S. dollar weakens compared to these and other currencies, our operating expenses for foreign operations will be higher when remeasured back into U.S. dollars. Economic regulation in China could adversely impact our business and results of operations. We have a significant portion of our assembly and testing capacity in China.
If the U.S. dollar weakens compared to these and other currencies, our operating expenses for foreign operations will be higher when remeasured back into U.S. dollars. Economic regulation in China could adversely impact our business and results of operations. For many years, the Chinese economy has experienced periods of rapid growth and wide fluctuations in the rate of inflation.
Although our key suppliers commit to us to be compliant with applicable ISO 9001 and/or TS-16949 quality standards, we have experienced quality and reliability issues with suppliers in the past. Quality or reliability issues in our supply chain could negatively affect our products, our reputation and our results of operations. We face risks related to sales through distributors.
Although our key suppliers commit to us to be compliant with applicable ISO 9001 and/or TS-16949 quality standards, we have experienced quality and reliability issues with suppliers in the past.
Changes in the interpretation and application of employment-related laws to our workforce practices may also result in increased operating costs and less flexibility in how we meet our changing workforce needs. We cannot be sure that we will be able to attract and retain skilled personnel in the future, which could harm our business and our results of operations.
Changes in the interpretation and application of employment-related laws to our workforce practices may also result in increased operating costs and less flexibility in how we meet our changing workforce needs.
We protect this information by entering into confidentiality agreements with our employees, consultants, strategic partners and other third parties. We also design our computer systems and networks and implement various procedures to restrict unauthorized access to dissemination of our proprietary information. We face internal and external data security threats.
We also design our computer systems and networks and implement various procedures to restrict unauthorized access to, or dissemination of, our proprietary information. We face internal and external data security threats.
Such actions in the future, as well as other changes in Chinese laws and regulations, including actions in furtherance of China’s stated policy of reducing its dependence on foreign semiconductor manufacturers, could increase the cost of doing business in China, foster the emergence of Chinese-based competitors, decrease the demand for our products in China and reduce the supply of critical materials for our products, which could have a material adverse effect on our business and results of operations.
Such actions in the future, as well as other changes in Chinese laws and regulations, including actions in furtherance of China’s stated policy of reducing its dependence on foreign semiconductor manufacturers, could increase the cost of doing business in China (where a significant portion of our assembly and test services are performed), foster the emergence of China-based competitors, decrease the demand for our products in China and reduce the supply of critical materials for our products, which could have a material adverse effect on our business and results of operations. 25 Table of Contents Changes in government trade policies, including the imposition of tariffs and export restrictions, have limited and could continue to limit our ability to sell or provide our products and other items to certain customers and suppliers, which may materially adversely affect our sales and results of operations.
We may face challenges with government regulators and our customers and suppliers if we are unable to sufficiently make any required determination that the metals used in our products are conflict free.
We may face challenges with government regulators and our customers and suppliers if we are unable to sufficiently make any required determination that the metals used in our products are conflict-free. New climate change laws and regulations could require us to change our manufacturing processes or procure substitute raw materials that may cost more or be more difficult to procure.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. PROPERTIES. Our corporate headquarters (leased) and our MP headquarters (owned) are in Greensboro, North Carolina, and our IDP headquarters (owned) is in Richardson, Texas.
Biggest changeITEM 2. PROPERTIES. Our corporate headquarters (owned) is located in Greensboro, North Carolina.
The following table sets forth our primary production facilities as of April 2, 2022: Location Owned/Leased Primary Function Greensboro, North Carolina Owned Wafer fabrication Hillsboro, Oregon Owned Wafer fabrication Richardson, Texas Owned Wafer fabrication, assembly and test Beijing, China (1) Owned Module assembly and test Dezhou, China Leased Module assembly and test Heredia, Costa Rica Owned Module and filter assembly and test Nuremberg, Germany Leased Packaging and test (1) We hold land-use rights for the land associated with this property.
The following table sets forth our primary production facilities as of March 30, 2024: Location Owned/Leased Primary Function Greensboro, North Carolina Owned Wafer fabrication Hillsboro, Oregon Owned Wafer fabrication Richardson, Texas Owned Wafer fabrication, assembly and test Beijing, China (1) Owned Module assembly and test Dezhou, China Leased Module assembly and test Heredia, Costa Rica Owned Module and filter assembly and test Nuremberg, Germany Leased Packaging and test (1) We hold land-use rights for the land associated with this property.
In fiscal 2021, we temporarily idled a BAW manufacturing facility (owned) in Farmers Branch, Texas. We believe our properties have been well-maintained, are in sound operating condition and contain all equipment and facilities necessary to operate at present levels.
In fiscal 2021, we idled a BAW manufacturing facility (owned) in Farmers Branch, Texas, which was subsequently sold in fiscal 2024. We believe our properties have been well-maintained, are in sound operating condition and contain all equipment and facilities necessary to operate at present levels.
Added
In the third quarter of fiscal 2024, we entered into a definitive agreement with Luxshare to divest our assembly and test operations in Beijing and Dezhou. In connection with this transaction, which was completed on May 2, 2024, Luxshare is providing assembly and test services to us under a long-term supply agreement.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe comparisons in the graph and table are based on historical data and are not indicative of, or intended to forecast, the possible future performance of our common stock. 31 Table of Contents PERFORMANCE GRAPH April 1, 2017 March 31, 2018 March 30, 2019 March 28, 2020 April 3, 2021 April 2, 2022 Qorvo, Inc. $100.00 $102.76 $104.62 $117.69 $281.36 $177.23 S&P 500 $100.00 $113.99 $124.82 $116.11 $181.54 $209.94 S&P Semiconductors (new industry index) $100.00 $136.49 $143.09 $152.66 $269.43 $343.53 Nasdaq Electronic Components (former industry index) $100.00 $135.34 $133.28 $139.93 $272.10 $324.18 The graph and the table above shall not be deemed "filed" with the SEC for the purpose of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall they be deemed incorporated by reference in any filings made by us with the SEC, regardless of any general incorporation language in such filing. 32 Table of Contents Issuer Purchases of Equity Securities Period Total number of shares purchased (in thousands) Average price paid per share Total number of shares purchased as part of publicly announced plans or programs (in thousands) Approximate dollar value of shares that may yet be purchased under the plans or programs January 2, 2022 to January 29, 2022 284 $ 140.92 284 $ 1,148.5 million January 30, 2022 to February 26, 2022 1,039 132.89 1,039 1,010.5 million February 27, 2022 to April 2, 2022 1,138 130.80 1,138 861.7 million Total 2,461 $ 132.85 2,461 $ 861.7 million On May 5, 2021, we announced that our Board of Directors authorized a share repurchase program to repurchase up to $2.0 billion of our outstanding common stock, which included approximately $236.9 million authorized under a prior program terminated concurrent with the new authorization.
Biggest changePERFORMANCE GRAPH March 30, 2019 March 28, 2020 April 3, 2021 April 2, 2022 April 1, 2023 March 30, 2024 Qorvo, Inc. $ 100.00 $ 112.49 $ 268.93 $ 169.40 $ 141.60 $ 160.09 S&P 500 $ 100.00 $ 93.02 $ 145.44 $ 168.20 $ 155.20 $ 201.57 S&P 500 Semiconductors $ 100.00 $ 106.69 $ 188.30 $ 240.08 $ 232.90 $ 494.08 The graph and the table above shall not be deemed "filed" with the SEC for the purpose of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall they be deemed incorporated by reference in any filings made by us with the SEC, regardless of any general incorporation language in such filing. 33 Table of Contents Issuer Purchases of Equity Securities Period Total number of shares purchased (in thousands) Average price paid per share Total number of shares purchased as part of publicly announced plans or programs (in thousands) Approximate dollar value of shares that may yet be purchased under the plans or programs (in millions) December 31, 2023 to January 27, 2024 139 $ 105.32 139 $ 1,390.3 January 28, 2024 to February 24, 2024 368 110.29 368 1,349.7 February 25, 2024 to March 30, 2024 388 115.38 388 1,305.0 Total 895 $ 111.72 895 $ 1,305.0 On November 2, 2022, we announced that our Board of Directors authorized a new share repurchase program to repurchase up to $2.0 billion of our outstanding common stock, which included the remaining authorized dollar amount under a prior program terminated concurrent with the new authorization.
Under this program, share repurchases are made in accordance with applicable securities laws on the open market or in privately negotiated transactions. The extent to which we repurchase our shares, the number of shares and the timing of any repurchases depends on general market conditions, regulatory requirements, alternative investment opportunities and other considerations.
Under the current program, share repurchases are made in accordance with applicable securities laws on the open market or in privately negotiated transactions. The extent to which we repurchase our shares, the number of shares and the timing of any repurchases depends on general market conditions, regulatory requirements, alternative investment opportunities and other considerations.
Our common stock is traded on the Nasdaq Global Select Market under the symbol "QRVO." As of May 13, 2022, there were 653 holders of record of our common stock, which does not include beneficial owners of stock held in street name (i.e., through a brokerage firm, bank, broker-dealer, trust or other similar organization).
Our common stock is traded on the Nasdaq Global Select Market under the symbol "QRVO." As of May 13, 2024, there were 618 holders of record of our common stock, which does not include beneficial owners of stock held in street name (i.e., through a brokerage firm, bank, broker-dealer, trust or other similar organization).
We have never declared or paid any dividends on our common stock. We currently intend to retain any future earnings to invest in the growth and operation of our business and do not intend to pay any dividends for the foreseeable future.
We have never declared or paid any dividends on our common stock. We currently intend to retain any future earnings to invest in the growth and operation of our business and do not intend to pay any dividends for the 32 Table of Contents foreseeable future.
The graph and table assume an initial investment of $100 was made on April 1, 2017 in each of our common stock and the indexes, reflecting compounded daily returns as well as reinvestment of all dividends. The indexes are reweighted daily using the market capitalization on the previous trading day.
The graph and table assume an initial investment of $100 was made on March 30, 2019 in each of our common stock and the indexes, reflecting compounded daily returns as well as reinvestment of all dividends. The indexes are reweighted daily using the market capitalization on the previous trading day.
The program does not require us to repurchase a minimum number of shares, does not have a fixed term, and may be modified, suspended or terminated at any time without prior notice. See Note 16 of the Notes to Consolidated Financial Statements for further discussion of our share repurchase program. ITEM 6. [RESERVED]
The program does not require us to repurchase a minimum number of shares, does not have a fixed term, and may be modified, suspended, or terminated at any time without prior notice. Refer to Note 17 of the Notes to Consolidated Financial Statements for further discussion of our share repurchase program.
Any future determination related to our dividend policy will be made at the discretion of our board of directors.
Any future determination related to our dividend policy will be made at the discretion of our Board of Directors. The following graph and table compare the cumulative total shareholder return of our common stock, the S&P 500 Index and the S&P 500 Semiconductors Index for the five years ended March 30, 2024.
Removed
The following graph and table compare the cumulative total shareholder return of our common stock, the S&P 500 Index, the Nasdaq Electronic Components Index (former industry index) and the S&P Semiconductors Index (new industry index), for the five years ended April 2, 2022. We believe the new industry index is more representative of the industry in which we operate.
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The comparisons in the graph and table are based on historical data and are not indicative of, or intended to forecast, the possible future performance of our common stock.
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As of January 1, 2023, our share repurchases in excess of issuances are subject to a 1% excise tax enacted by the IRA. The excise tax is recognized as part of the cost basis of shares acquired in the Consolidated Statements of Stockholders' Equity for fiscal years 2024 and 2023 and is excluded from amounts presented above. ITEM 6. [RESERVED]

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeIn performing qualitative assessments, we consider (i) our overall historical and projected future operating results, (ii) if there was a significant decline in our stock price for a sustained period, (iii) if there was a significant change in our market capitalization relative to our net book value, and (iv) if there was a prolonged or more significant slowdown in the worldwide economy of the semiconductor industry, as well as other relevant events and factors affecting the reporting unit.
Biggest changeIn performing 44 Table of Contents qualitative assessments, we consider the following factors which could trigger a goodwill impairment review: (i) significant underperformance relative to historical or projected future operating results; (ii) significant changes in the manner or our use of the acquired assets or the strategy for our overall business; (iii) significant negative industry or economic trends; (iv) a significant decline in our stock price for a sustained period; and (v) a significant change in our market capitalization relative to our net book value.
The current program does not require us to repurchase a minimum number of shares, does not have a fixed term, and may be modified, suspended or terminated at any time without prior notice.
The program does not require us to repurchase a minimum number of shares, does not have a fixed term, and may be modified, suspended or terminated at any time without prior notice.
The valuation of inventory requires us to estimate obsolete or excess inventory. The determination of obsolete or excess inventory requires us to estimate the future demand for our products within specific time horizons, generally 12 to 24 months.
The determination of obsolete or excess inventory requires us to estimate the future demand for our products within specific time horizons, generally 12 to 24 months.
Credit Agreement On September 29, 2020, we and certain of our U.S. subsidiaries (the “Guarantors”) entered into a five-year unsecured senior credit facility pursuant to a credit agreement (as amended, restated, modified or otherwise supplemented from time to time, the “2020 Credit Agreement”) with Bank of America, N.A., acting as administrative agent, and a syndicate of lenders.
Credit Agreement On September 29, 2020, we and certain of our U.S. subsidiaries (the "Guarantors") entered into a five-year unsecured senior credit facility pursuant to a credit agreement (as amended, restated, modified or otherwise supplemented from time to time, the "2020 Credit Agreement") with Bank of America, N.A., acting as administrative agent, and a syndicate of lenders.
See Note 10 of the Notes to Consolidated Financial Statements for further information. 40 Table of Contents SUPPLEMENTAL PARENT AND GUARANTOR FINANCIAL INFORMATION In accordance with the indentures governing the 2024 Notes, the 2029 Notes and the 2031 Notes (together, the "Notes"), our obligations under the Notes are fully and unconditionally guaranteed on a joint and several unsecured basis by the Guarantors, which are listed on Exhibit 22 to this Annual Report on Form 10-K.
Refer to Note 11 of the Notes to Consolidated Financial Statements for further information. 41 Table of Contents SUPPLEMENTAL PARENT AND GUARANTOR FINANCIAL INFORMATION In accordance with the indentures governing the 2024 Notes, the 2029 Notes and the 2031 Notes (together, the "Notes"), our obligations under the Notes are fully and unconditionally guaranteed on a joint and several unsecured basis by the Guarantors, which are listed on Exhibit 22 to this Annual Report on Form 10-K.
Debt obligations are classified based on their stated maturity date, and any future redemptions would impact our cash payments. See Note 9 of the Notes to Consolidated Financial Statements for further information.
Debt obligations are classified based on their stated maturity date, and any future redemptions would impact our cash payments. Refer to Note 10 of the Notes to Consolidated Financial Statements for further information.
For fiscal 2021, this resulted in an annual effective tax rate of 9.1%. A valuation allowance has been established against deferred tax assets in the taxing jurisdictions where, based upon the positive and negative evidence available, it is more likely than not that the related deferred tax assets will not be realized.
This resulted in an annual effective tax rate of 17.2% for fiscal 2023. A valuation allowance has been established against deferred tax assets in the taxing jurisdictions where, based upon the positive and negative evidence available, it is more likely than not that the related deferred tax assets will not be realized.
Pension benefit payments were approximately $0.3 million in fiscal 2022 and are expected to be approximately $0.3 million in fiscal 2023. We also offer a non-qualified deferred compensation plan to eligible participants to defer and invest a specified percentage of their cash compensation.
Pension benefit payments were approximately $0.3 million in fiscal 2024 and are expected to be approximately $0.4 million in fiscal 2025. We also offer a non-qualified deferred compensation plan to eligible participants to defer and invest a specified percentage of their cash compensation.
(3) Long-term debt obligations represent future cash payments of principal and interest over the life of the 2024 Notes, the 2029 Notes and the 2031 Notes, including anticipated interest payments not recorded as liabilities on our Consolidated Balance Sheet as of April 2, 2022.
(3) Long-term debt obligations represent future cash payments of principal and interest over the life of the 2024 Notes, the 2029 Notes and the 2031 Notes, including anticipated interest payments not recorded as liabilities on our Consolidated Balance Sheet as of March 30, 2024.
Based on current and projected levels of cash flows from operations, coupled with our existing cash and cash equivalents and our Credit Facility, we believe that we have sufficient liquidity to meet both our short-term and long-term cash requirements.
Based on current and projected levels of cash flows from operations, coupled with our existing cash and cash equivalents and availability from the 2024 Revolving Facility, we believe that we have sufficient liquidity to meet both our short-term and long-term cash requirements.
We apply a five-step approach as defined in ASC 606, " Revenue from Contracts with Customers, " in determining the amount and timing of revenue to be recognized: (1) identifying the contract with a customer; (2) identifying the performance obligations in the contract; (3) determining the transaction price; (4) allocating the transaction price to the performance obligations in the contract; and (5) recognizing revenue when the corresponding performance obligation is satisfied.
We apply a five-step approach in determining the amount and timing of revenue to be recognized: (1) identifying the contract with a customer; (2) identifying the performance obligations in the contract; (3) determining the transaction price; (4) allocating the transaction price to the performance obligations in the contract; and (5) recognizing revenue when the corresponding performance obligation is satisfied.
See Note 13 of the Notes to Consolidated Financial Statements for additional information regarding our uncertain tax positions and the amount of unrecognized tax benefits.
Refer to Note 14 of the Notes to Consolidated Financial Statements for additional information regarding our uncertain tax positions and the amount of unrecognized tax benefits.
See Note 13 of the Notes to Consolidated Financial Statements for additional information regarding changes in the valuation allowance and net deferred tax assets. As part of our financial process, we also assess the likelihood that our tax reporting positions will ultimately be sustained.
Refer to Note 14 of the Notes to Consolidated Financial Statements for additional information regarding changes in the valuation allowance and net deferred tax assets. We also assess the likelihood that our tax reporting positions will ultimately be sustained.
Product-specific facts and circumstances reviewed in the inventory 41 Table of Contents valuation process include a review of the customer base, market conditions and customer acceptance of our products and technologies, as well as an assessment of the selling price in relation to the product cost.
Product-specific facts and circumstances reviewed in the inventory valuation process include a review of the customer base, 42 Table of Contents market conditions and customer acceptance of our products and technologies, as well as an assessment of the selling price in relation to the product cost. These valuations and estimates require significant judgment.
A majority of our revenue is recognized at a point in time, either on shipment or delivery of the product, depending on individual customer terms and conditions. Revenue from sales to our distributors is recognized upon shipment of the product to the distributors (sell-in).
A majority of our revenue is recognized at a point in time, either on shipment or delivery of the product, depending on individual customer terms and conditions.
Other Contractual Obligations As of April 2, 2022, in addition to the amounts shown in the contractual obligations table above, we have $13.8 million of unrecognized income tax benefits and accrued interest and penalties which has been recorded as a liability. We are uncertain as to if, or when, such amounts may be settled.
Other Contractual Obligations As of March 30, 2024, in addition to the amounts shown in the contractual obligations table above, we have $43.9 million of unrecognized income tax benefits and accrued interest and penalties which have been recorded as a liability. We are uncertain as to if, or when, such amounts may be settled.
As discussed in Note 10 of the Notes to Consolidated Financial Statements, we have two pension plans in Germany with a combined benefit obligation of approximately $12.1 million as of April 2, 2022. Pension benefit payments are not included in the schedule above due to the uncertainty regarding the amount and timing of any future cash outflows.
As discussed in Note 11 of the Notes to Consolidated Financial Statements, we have two pension plans in Germany with a combined benefit obligation of approximately $9.6 million as of March 30, 2024. Pension benefit payments are not included in the schedule above due to the uncertainty regarding the amount and timing of any future cash outflows.
The income approach includes management’s estimation of future cash flows (including expected revenue growth rates and profitability), the underlying product or technology life cycles and the discount rates applied to future cash flows.
The valuation of intangible assets requires the use of valuation techniques such as the income approach. The income approach includes management’s estimation of future cash flows (including expected revenue growth rates and profitability), the underlying product or technology life cycles and the discount rates applied to future cash flows.
See Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended April 3, 2021, filed with the SEC on May 24, 2021, which is incorporated by reference herein, for a summary of our results of operations for the fiscal year ended March 28, 2020 along with a year-over-year comparison between fiscal years 2021 and 2020.
Refer to Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended April 1, 2023, filed with the SEC on May 19, 2023, which is incorporated by reference herein, for a summary of our results of operations for the fiscal year ended April 2, 2022 along with a year-over-year comparison between fiscal years 2023 and 2022.
As a result, during the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. After the measurement period, any purchase price adjustments are recognized in our Consolidated Statements of Income. Goodwill Impairment Testing.
As a result, during the measurement period, which may be up to one year from the acquisition 43 Table of Contents date, we may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. After the measurement period, any purchase price adjustments are recorded to the income statement.
See Note 13 of the Notes to Consolidated Financial Statements for additional information regarding income taxes. 37 Table of Contents STOCK-BASED COMPENSATION Under Accounting Standards Codification ("ASC") 718, " Compensation – Stock Compensation, " stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award using an option pricing model for stock options (Black-Scholes) and market price for restricted stock units, and is recognized as expense over the employee's requisite service period.
STOCK-BASED COMPENSATION Under Accounting Standards Codification ("ASC") 718, " Compensation – Stock Compensation, " stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award using an option pricing model for stock options (Black-Scholes) and market price for restricted stock units and is recognized as expense over the employee's requisite service period.
The 2020 Credit Agreement contains various conditions, covenants and representations with which we must be in compliance in order to borrow funds and to avoid an event of default. As of April 2, 2022 , we were in compliance with these covenants.
The 2020 Credit Agreement contained various conditions, covenants and representations with which we had to be in compliance in order to borrow funds and to avoid an event of default. As of March 30, 2024 , we were in compliance with these covenants.
However, if there is a significant decrease in demand for our products, or if our revenue grows faster than we anticipate, operating cash flows may be insufficient to meet our needs.
However, if there is a significant decrease in demand for our products, or if investments in our business outpace revenue growth, operating cash flows may be insufficient to meet our needs.
We also have an obligation related to the Transitional Repatriation Tax that we elected to pay over eight years which has been recorded as a liability. The remaining obligation of $5.4 million is to be paid over the next four years.
We also have an obligation related to the Transitional Repatriation Tax that we elected to pay over eight years. The remaining obligation of $3.6 million is recorded as a liability and is expected to be paid over the next two years.
Actual results could materially differ from those estimates. The accounting policies that are most critical in the preparation of our consolidated financial statements are those that are both important to the presentation of our financial condition and results of operations and require significant judgment and estimates on the part of management.
The accounting policies that are most critical in the preparation of our consolidated financial statements are those that are both important to the presentation of our financial condition and results of operations and require significant judgment and estimates on the part of management. Our critical accounting policies are reviewed periodically with the Audit Committee of the Board of Directors.
(2) Purchase obligations represent payments due related to the purchase of materials and manufacturing services, a majority of which are not recorded as liabilities on our Consolidated Balance Sheet because we had not received the related goods or services as of April 2, 2022. See Note 11 of the Notes to Consolidated Financial Statements for further information.
(2) Purchase obligations represent payments due related to the purchase of materials and manufacturing services, a majority of which are not recorded as liabilities on our Consolidated Balance Sheet because we had not received the related goods or services as of March 30, 2024.
Our critical accounting policies are reviewed periodically with the Audit Committee of the Board of Directors. We also have other policies that we consider key accounting policies; however, these policies typically do not require us to make estimates or judgments that are difficult or subjective. See Note 1 of the Notes to Consolidated Financial Statements. Inventory Reserves.
We also have other policies that we consider key accounting policies; however, these policies typically do not require us to make estimates or judgments that are difficult or subjective. Refer to Note 1 of the Notes to Consolidated Financial Statements. Inventory Reserves. The valuation of inventory requires us to estimate obsolete or excess inventory.
The process of evaluating property and equipment for impairment is highly subjective and requires significant judgment as we are required to make assumptions about items such as future demand for our products and industry trends. Business Acquisitions. We allocate the fair value of the purchase price to the assets acquired and liabilities assumed based on their estimated fair value.
The process of evaluating property and equipment for impairment is highly subjective and requires significant judgment as we are required to make assumptions about items such as future demand for our products and industry trends.
We provided our products to our largest end customer (Apple) through sales to multiple contract manufacturers, which in the aggregate accounted for approximately 33% and 30% of total revenue in fiscal years 2022 and 2021, respectively. Samsung accounted for approximately 11% and 7% of total revenue in fiscal years 2022 and 2021, respectively.
We provide products to our largest end customer (Apple) through sales to multiple contract manufacturers, which in the aggregate accounted for approximately 46% and 37% of total revenue in fiscal years 2024 and 2023, respectively. Samsung accounted for approximately 12% of total revenue in both fiscal years 2024 and 2023.
Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled in exchange for those goods or services.
Refer to Note 7 of the Notes to Consolidated Financial Statements for additional information regarding our identified intangible assets. Revenue Recognition. Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled in exchange for those goods or services.
On May 5, 2021, we announced that our Board of Directors authorized a new share repurchase program to repurchase up to $2.0 billion of our outstanding common stock, which included approximately $236.9 million authorized under the program announced on October 31, 2019, which was terminated concurrent with the new authorization.
Stock Repurchases On November 2, 2022, we announced that our Board of Directors authorized a new share repurchase program to repurchase up to $2.0 billion of our outstanding common stock, which included the remaining authorized dollar amount under a prior program terminated concurrent with the new authorization.
OVERVIEW Company Qorvo® is a global leader in the development and commercialization of technologies and products for wireless, wired and power markets. We design, develop, manufacture and market our products to U.S. and international OEMs and ODMs in two operating segments, MP and IDP, which are also our reportable segments.
Qorvo ® is a global leader in the development and commercialization of technologies and products for wireless, wired and power markets. We design, develop, manufacture and market our products to U.S. and international OEMs and ODMs in three reportable operating segments: HPA, CSG and ACG. HPA is a leading global supplier of RF, analog mixed signal and power management solutions.
The 2020 Credit Agreement amended and restated the previous credit agreement dated as of December 5, 2017 (the “2017 Credit Agreement”). The 2020 Credit Agreement included a senior term loan (the “2020 Term Loan”) of $200.0 million and a senior revolving line of credit (the “Revolving Facility”) of up to $300.0 million (collectively the “Credit Facility”).
The 2020 Credit Agreement amended and restated the previous credit agreement dated as of December 5, 2017. The 2020 Credit Agreement included a senior revolving line of credit (the "2020 Revolving Facility") of up to $300.0 million and a senior term loan that was fully repaid in fiscal 2022.
The extent to which we repurchase our shares, the number of shares and the timing of any repurchases depends on general market conditions, regulatory requirements, alternative investment opportunities and other considerations.
Under the current program, share repurchases are made in accordance with applicable securities laws on the open market or in privately negotiated transactions. The extent to which we repurchase our shares, the number of shares and the timing of any repurchases depends on general market conditions, regulatory requirements, alternative investment opportunities and other considerations.
The total deferred compensation obligation as of April 2, 2022 was $39.4 million, of which $1.5 million is estimated to be paid in fiscal 2023.
The total deferred compensation obligation as of March 30, 2024 was $52.3 million, of which $2.3 million is estimated to be paid in fiscal 2025.
See Note 16 of the Notes to Consolidated Financial Statements for additional information regarding our stock repurchases. Our future capital requirements may differ materially from those currently anticipated and will depend on many factors, including market acceptance of and demand for our products, acquisition opportunities, technological advances and our relationships with suppliers and customers.
The decrease in cash used in financing activities was primarily due to lower stock repurchases in fiscal 2024, partially offset by repurchases of our 2024 Notes. 40 Table of Contents Our future capital requirements may differ materially from those currently anticipated and will depend on many factors, including market acceptance of and demand for our products, acquisition opportunities, technological advances and our relationships with suppliers and customers.
Our $972.6 million of total cash and cash equivalents as of April 2, 2022, includes $831.8 million held by our foreign subsidiaries, of which $709.5 million is held by Qorvo International Pte. Ltd. in Singapore.
Our $1,029.3 million of total cash and cash equivalents as of March 30, 2024, includes $752.0 million held by our foreign subsidiaries, of which $507.5 million is held by Qorvo International Pte. Ltd. in Singapore.
As of April 2, 2022, total remaining unearned compensation cost related to unvested restricted stock units was $121.0 million, which will be amortized over the weighted-average remaining service period of approximately 1.2 years. LIQUIDITY AND CAPITAL RESOURCES Cash generated by operations is our primary source of liquidity.
As of March 30, 2024, total remaining unearned compensation cost related to unvested restricted stock units was $159.4 million, which will be amortized over the weighted-average remaining service period of approximately 1.4 years.
If recovery is not more likely than not (a likelihood of less than 50 percent), the provision for taxes must be increased by recording a reserve in the form of a valuation allowance for the deferred tax assets that are estimated not to ultimately be recoverable.
We assess the likelihood that our deferred tax assets can be recovered, recording a reserve in the form of a valuation allowance if the deferred tax assets are ultimately estimated to not be recoverable.
This was primarily comprised of tax expense related to domestic and international operations generating pre-tax book income (exclusive of nondeductible expenses associated with acquisition related adjustments), the impact of the Tax Act's GILTI provisions and an increase in gross unrecognized tax benefits, offset by a tax benefit related to international operations generating pre-tax book losses and domestic tax credits.
Income tax expense Income tax expense for fiscal 2024 was $143.9 million, which was primarily comprised of tax expense related to international operations generating pre-tax book income and the impact of GILTI, offset by a tax benefit related to domestic and international operations generating pre-tax book losses and domestic tax credits.
A number of assumptions, estimates and judgments are used in determining the fair value of acquired assets and liabilities, particularly with respect to the intangible assets acquired. The valuation of intangible assets requires the use of valuation techniques such as the income approach.
Goodwill is assigned to the reporting unit that is expected to benefit from the synergies of the business combination. A number of significant assumptions, estimates and judgments are used in determining the fair value of acquired assets and liabilities, particularly with respect to the intangible assets acquired.
The asset balances relating to abandoned projects are impaired and expensed to R&D. 43 Table of Contents We evaluate definite-lived intangible assets for impairment in accordance with ASC 360-10-35, " Impairment or Disposal of Long-Lived Assets " to determine whether facts and circumstances (including external factors such as industry and economic trends and internal factors such as changes in our business strategy and forecasts) indicate that the carrying amount of the assets may not be recoverable.
The asset balances relating to abandoned projects are impaired and expensed to research and development. We evaluate definite-lived intangible assets for impairment to determine whether facts and circumstances indicate that the carrying amount of the assets may not be recoverable.
As of April 2, 2022, we had working capital of approximately $1,774.7 million, including $972.6 million in cash and cash equivalents, compared to working capital of approximately $1,802.2 million, including $1,397.9 million in cash and cash equivalents, as of April 3, 2021.
As of March 30, 2024, we had working capital of approximately $1,215.9 million, including $1,029.3 million in cash and cash equivalents, compared to working capital of approximately $1,474.0 million, including $808.8 million in cash and cash equivalents, as of April 1, 2023.
Inherent in the fair value determination are significant judgments and estimates, including assumptions about our future revenue, profitability and cash flows, our operational plans and our interpretation of current economic indicators and market valuations. To the extent these assumptions are incorrect or there are further declines in our business outlook, additional goodwill impairment charges may be recorded in future periods.
Our quantitative assessments considered both the income and market approaches to estimate the fair value of each reporting unit. Inherent in the fair value determinations are significant judgments and estimates, including assumptions about future revenue, profitability and cash flows, our operational plans and our interpretation of current economic indicators and market valuations.
In accordance with ASC 350, " Intangibles - Goodwill and Other " ("ASC 350"), goodwill is not amortized, but rather is reviewed for impairment at the reporting unit level on the first day of our fourth quarter of each fiscal year, or when there is evidence that events or changes in circumstances indicate that the carrying amount of the goodwill may not be recovered.
As required by the Company’s policy, goodwill is tested for impairment on the first day of our fourth quarter of each fiscal year, or when there is evidence that events or changes in circumstances indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill.
These customers primarily purchase RF solutions for a variety of mobile devices. International shipments amounted to $2,717.3 million in fiscal 2022 (approximately 58% of revenue) compared to $2,384.2 million in fiscal 2021 (approximately 59% of revenue). Shipments to Asia totaled $2,465.7 million in fiscal 2022 (approximately 53% of revenue) compared to $2,191.2 million in fiscal 2021 (approximately 55% of revenue).
These customers primarily purchase RF solutions for a variety of mobile devices. International shipments amounted to $1,593.6 million in fiscal 2024 (approximately 42% of revenue) compared to $1,751.4 million in fiscal 2023 (approximately 49% of revenue).
The excess of the purchase price over the fair values of the identifiable assets and liabilities is recorded to goodwill. Goodwill is assigned to the reporting unit that is expected to benefit from the synergies of the business combination.
Business Acquisitions. We allocate the fair value of the purchase price to the assets acquired and liabilities assumed based on their estimated fair value. The excess of the purchase price over the fair values of the identifiable assets and liabilities is recorded to goodwill.
We amortize definite-lived intangible assets (including developed technology, customer relationships, technology licenses, backlog and trade names) over their estimated useful lives. In-process research and development ("IPRD") assets represent the fair value of incomplete R&D projects that had not reached technological feasibility as of the date of the acquisition; initially, these are classified as IPRD and are not subject to amortization.
Identified Intangible Assets. We amortize definite-lived intangible assets (including developed technology, customer relationships, technology licenses and trade names) on a straight-line basis over their estimated useful lives. Upon completion of development, in-process research and development assets are transferred to developed technology and are amortized over their useful lives.
Therefore, we determined that it was more likely than not that the fair value of the reporting unit was less than its carrying amount, and we performed a quantitative assessment to calculate the fair value of the reporting unit. Our quantitative assessment considered both the income and market approaches to estimate the fair value of the reporting unit.
We concluded that it was more likely than not that the fair value of this reporting unit was below its carrying amount, and a quantitative analysis was performed. The quantitative analysis (based on the income approach) resulted in a $173.4 million write-off of the remaining goodwill of this reporting unit.
Other income (expense), net Other income (expense) includes realized or unrealized gains and losses from investments, interest income, foreign currency changes and losses on debt extinguishments. During fiscal 2022, we recorded $12.0 million of income based on our share of the earnings from our limited partnership investments, and we recorded net gains of $2.7 million from other investments.
Interest expense in the preceding table for fiscal years 2024 and 2023 is net of capitalized interest of $2.9 million and $3.9 million, respectively. 37 Table of Contents Other income, net During fiscal 2024, we recorded interest income of $38.3 million, losses of $1.2 million based on our share of the earnings from our limited partnership investments and a net gain on debt extinguishment of $1.8 million.
In fiscal 2021, we completed qualitative assessments and concluded that based on the relevant events and circumstances, it was more likely than not that each of the reporting unit’s fair value exceeded its related carrying value, and no further impairment testing was required. Identified Intangible Assets.
Based on our fiscal 2024 qualitative assessment, we concluded there were no events or circumstances that indicated it was more likely than not that the fair value of each reporting unit was less than its respective carrying value. Refer to Note 7 of the Notes to Consolidated Financial Statements for additional information regarding our goodwill and intangible assets.
As of the end of fiscal years 2022 and 2021, the valuation allowance against domestic and foreign deferred tax assets was $36.3 million and $36.5 million, respectively.
As of the end of fiscal years 2024 and 2023, the valuation allowance against domestic and foreign deferred tax assets was $43.6 million and $35.9 million, respectively. Refer to Note 14 of the Notes to Consolidated Financial Statements for additional information regarding income taxes.
Other Operating Expense Other operating expense increased in fiscal 2022 primarily due to a goodwill impairment charge of $48.0 million. See Note 6 of the Notes to Consolidated Financial Statements for additional information.
Refer to Note 6 of the Notes to Consolidated Financial Statements for additional information regarding our business acquisitions. Goodwill Impairment Testing.
Further, we cannot be sure that additional debt or equity financing, if required, will be available on favorable terms, if at all. 39 Table of Contents CONTRACTUAL OBLIGATIONS The following table summarizes our significant contractual obligations and commitments (in thousands) as of April 2, 2022, and the effect such obligations are expected to have on our liquidity and cash flows in future periods.
Further, we cannot be sure that additional debt or equity financing, if required, will be available on favorable terms, if at all.
The Revolving Facility includes a $25.0 million sublimit for the issuance of standby letters of credit and a $10.0 million sublimit for swing line loans. The Credit Facility is available to finance working capital, capital expenditures and other general corporate purposes.
Up to $25.0 million of the 2024 Revolving Facility may be used for the issuance of standby letters of credit and up to $10.0 million of the 2024 Revolving Facility may be used for swing line advances (i.e., short-term borrowings made available from the lead lender).
This was primarily comprised of tax expense related to international operations generating pre-tax book income, the impact of the Tax Act's GILTI provisions, the reversal of the permanent reinvestment assertion with regards to certain unrepatriated foreign earnings and an increase in gross unrecognized tax benefits, offset by a tax benefit related to international operations generating pre-tax book losses and domestic tax credits.
Income tax expense for fiscal 2023 was $21.5 million, which was primarily comprised of tax expense related to international operations generating pre-tax book income and the impact of GILTI (including the effects of the capitalization and amortization of research and development expenses which were previously expensed for U.S. tax purposes), offset by a tax benefit related to domestic and international operations generating pre-tax book losses and domestic tax credits.
See Note 17 of the Notes to Consolidated Financial Statements for a reconciliation of segment operating income to the consolidated operating income for fiscal years 2022, 2021 and 2020. 36 Table of Contents INTEREST, OTHER INCOME (EXPENSE) AND INCOME TAXES Fiscal Year (In thousands) 2022 2021 Interest expense $ (63,326) $ (75,198) Other income (expense), net 18,341 (24,049) Income tax expense (147,731) (73,769) Interest expense During fiscal 2022, we recorded interest expense primarily related to our 4.375% senior notes due 2029 (the "2029 Notes") and our 3.375% senior notes due 2031 (the "2031 Notes").
INTEREST, OTHER INCOME AND INCOME TAXES Fiscal Year (In thousands) 2024 2023 Interest expense $ (69,245) $ (68,463) Other income, net 51,104 9,924 Income tax expense (143,882) (21,477) Interest expense During fiscal years 2024 and 2023, we recorded interest expense primarily related to the 4.375% senior notes due 2029 (the "2029 Notes"), the 3.375% senior notes due 2031 (the "2031 Notes") and the 2024 Notes.
Summarized Balance Sheets (in thousands) April 2, 2022 April 3, 2021 ASSETS Current assets (1) $ 771,528 $ 1,143,086 Non-current assets $ 2,624,454 $ 2,450,960 LIABILITIES Current liabilities $ 241,674 $ 240,943 Long-term liabilities (2) $ 2,634,501 $ 2,250,666 (1) Includes net amounts due from Non-Guarantor subsidiaries of $286.8 million and $532.4 million as of April 2, 2022 and April 3, 2021, respectively.
Summarized Balance Sheets (in thousands) March 30, 2024 April 1, 2023 ASSETS Current assets (1) $ 803,900 $ 972,989 Non-current assets 2,311,618 2,398,287 LIABILITIES Current liabilities $ 727,138 $ 296,049 Long-term liabilities (2) 2,306,883 2,689,824 (1) Includes net amounts due from Non-Guarantor subsidiaries of $129.8 million and $379.5 million as of March 30, 2024 and April 1, 2023, respectively.
MP is a global supplier of cellular, UWB, Wi-Fi and other wireless solutions for a variety of applications, including smartphones, wearables, laptops, tablets and IoT. IDP is a global supplier of RF, SoC and power management solutions for a wide range of markets, including cellular and IT infrastructure, automotive, renewable energy, defense and IoT.
CSG is a leading global supplier of connectivity and sensor solutions, with broad expertise spanning UWB, Matter, Bluetooth Low Energy, Zigbee, Thread, Wi-Fi, cellular IoT and MEMS-based sensors. ACG is a leading global supplier of cellular RF solutions for smartphones, wearables, laptops, tablets and other devices.
These estimates are developed as part of our long-term planning process based on assumed market segment growth rates and our assumed market segment share, estimated costs based on historical data and various internal estimates.
The income approach was based on the discounted cash flow method that used estimates of the reporting units' revenue growth rates and operating margins as part of our long-term planning process, taking into consideration, historical data and industry and market conditions.
Payments Due By Fiscal Period Total Payments 2023 2024-2025 2026-2027 2028 and thereafter Capital commitments (1) $ 137,176 $ 116,482 $ 20,694 $ — $ — Purchase obligations (2) 2,019,516 902,162 880,450 236,904 — Leases 104,886 20,839 30,581 22,062 31,404 Long-term debt obligations (3) 2,586,399 69,587 627,313 133,437 1,756,062 Total $ 4,847,977 $ 1,109,070 $ 1,559,038 $ 392,403 $ 1,787,466 (1) Capital commitments represent obligations for the purchase of property and equipment, a majority of which are not recorded as liabilities on our Consolidated Balance Sheet because we had not received the related goods or services as of April 2, 2022.
CONTRACTUAL OBLIGATIONS The following table summarizes our significant contractual obligations and commitments (in thousands) as of March 30, 2024, and the effect such obligations are expected to have on our liquidity and cash flows in future periods: Payments Due By Fiscal Period Total Payments 2025 2026-2027 2028-2029 2030 and thereafter Capital commitments (1) $ 64,720 $ 62,460 $ 2,260 $ — $ — Purchase obligations (2) 462,703 424,668 33,656 4,379 — Leases 74,449 17,185 27,511 16,418 13,335 Long-term debt obligations (3) 2,397,747 508,246 133,438 109,813 1,646,250 Total $ 2,999,619 $ 1,012,559 $ 196,865 $ 130,610 $ 1,659,585 (1) Capital commitments represent obligations for the purchase of property and equipment, a majority of which are not recorded as liabilities on our Consolidated Balance Sheet because we had not received the related goods or services as of March 30, 2024.
Summarized Statement of Income (in thousands) Fiscal Year 2022 Revenue $ 1,126,193 Gross profit $ 268,025 Net loss $ (93,405) CRITICAL ACCOUNTING POLICIES AND ESTIMATES The preparation of consolidated financial statements requires management to use judgment and estimates. The level of uncertainty in estimates and assumptions increases with the length of time until the underlying transactions are completed.
(2) Includes net amounts due to Non-Guarantor subsidiaries of $597.3 million and $509.1 million as of March 30, 2024 and April 1, 2023, respectively. Summarized Statement of Operations (in thousands) Fiscal 2024 Revenue $ 1,073,492 Gross profit 162,178 Net loss (370,438) CRITICAL ACCOUNTING ESTIMATES The preparation of consolidated financial statements requires management to use judgment and estimates.
These decreases to cash provided by operating activities were partially offset by increased profitability as a result of demand and revenue growth. Cash Flows from Investing Activities Net cash used in investing activities in fiscal 2022 was $596.0 million, compared to $218.7 million in fiscal 2021.
This decrease in cash provided by operating activities was primarily due to decreased profitability. Cash Flows from Investing Activities Net cash used in investing activities in fiscal 2024 was $136.5 million, compared to $153.4 million in fiscal 2023.
In fiscal 2022, we completed our annual qualitative assessments and concluded that based on the relevant events and circumstances, it was more likely than not that four of our five reporting units’ fair values exceeded their related carrying values.
During fiscal 2024, we completed interim assessments for goodwill impairment as management determined, based on revisions to long-term forecasts, it was more likely than not that the fair values of two of our reporting units (one within the HPA operating segment and one within the CSG operating segment) were below the carrying amounts.
Removed
In fiscal 2022, the semiconductor industry continued to experience supply constraints, and we have taken actions to address short and long-term supply requirements. During the second quarter ended October 2, 2021, we entered into a long-term capacity agreement with a foundry supplier to reserve manufacturing supply capacity.
Added
Fiscal 2024 Overview • Revenue increased 5.6% in fiscal 2024 to $3,769.5 million, compared to $3,569.4 million in fiscal 2023, driven by content gains at our largest end customer and higher demand for our defense and aerospace products. • Gross margin for fiscal 2024 was 39.5%, compared to 36.3% in fiscal 2023, driven by lower charges associated with a long-term capacity reservation agreement and improved factory utilization. • Operating income was $91.7 million in fiscal 2024, compared to $183.2 million in fiscal 2023.
Removed
Under the agreement we are required to purchase, and the foundry supplier is required to supply, a certain number of wafers for calendar years 2022 through 2025. See Note 11 of the Notes to Consolidated Financial Statements for additional information regarding this agreement.
Added
This decrease was driven by goodwill impairment charges. • Net loss per share was $0.72 for fiscal 2024, compared to net income per diluted share of $1.00 for fiscal 2023. 34 Table of Contents • Operating activities in fiscal 2024 generated cash of $833.2 million, compared to $843.2 million in fiscal 2023. • Capital expenditures were $127.2 million in fiscal 2024, compared to $159.0 million in fiscal 2023. • We recorded $221.4 million in goodwill impairment charges due to revisions in long-term forecasts for a reporting unit within the CSG operating segment. • We completed the acquisition of Anokiwave for a purchase price of $83.0 million, net of cash acquired. • We repurchased approximately 4.0 million shares of our common stock for approximately $403.0 million. • We repurchased $60.3 million of the principal amount of our 1.750% senior notes due 2024 (the "2024 Notes"), plus accrued and unpaid interest, on the open market. • We entered into a definitive agreement with Luxshare to divest our assembly and test operations in China.
Removed
The COVID-19 pandemic (including the recent COVID-19 lockdowns in China) has been a contributing factor of the semiconductor industry supply constraints and may continue to cause volatility and uncertainty in customer demand, worldwide economies and financial markets for an extended period of time.
Added
RESULTS OF OPERATIONS Consolidated The table below presents a summary of our results of operations for fiscal years 2024 and 2023 along with a year-over-year comparison.
Removed
To date, any negative impact of COVID-19 on the overall demand for our products, cash flows from operations, need for capital expenditures and our liquidity position has been limited, although we are addressing capacity constraints in our supply chain as described above.
Added
(In thousands, except percentages) Fiscal 2024 % of Revenue Fiscal 2023 % of Revenue Increase (Decrease) Percentage Change Revenue $ 3,769,506 100.0 % $ 3,569,399 100.0 % $ 200,107 5.6 % Cost of goods sold 2,281,011 60.5 2,272,457 63.7 8,554 0.4 Gross profit 1,488,495 39.5 1,296,942 36.3 191,553 14.8 Research and development 682,249 18.1 649,841 18.2 32,408 5.0 Selling, general and administrative 389,140 10.3 358,790 10.1 30,350 8.5 Other operating expense (1) 325,405 8.7 105,143 2.9 220,262 209.5 Operating income $ 91,701 2.4 % $ 183,168 5.1 % $ (91,467) (49.9) % (1) Other operating expense includes goodwill impairment charges of $221.4 million and $12.4 million for fiscal years 2024 and 2023, respectively.
Removed
However, the recent COVID-19 lockdowns in China could negatively impact the overall demand for our products, cash flows from operations, need for capital expenditures and our liquidity position in future periods. 33 Table of Contents Fiscal 2022 Financial Highlights • Revenue increased 15.7% in fiscal 2022 to $4,645.7 million, compared to $4,015.3 million in fiscal 2021, driven primarily by higher demand for our 5G mobile solutions and our power management, automotive and broadband products, partially offset by lower demand for our base station and defense and aerospace products. • Gross margin for fiscal 2022 was 49.2%, compared to 46.9% in fiscal 2021, primarily due to lower intangible amortization expense as well as lower unit costs on higher volume and productivity.
Added
Revenue The increase in consolidated revenue resulted from a $394.2 million increase in ACG revenue and decreases in revenue of $154.2 million and $39.8 million, in HPA and CSG, respectively, which are further discussed in our Operating Segments results below.
Removed
The increase in gross margin was partially offset by average selling price erosion. • Operating income was $1,226.1 million in fiscal 2022, compared to $906.6 million in fiscal 2021. This increase was primarily due to higher revenue and favorable gross margin, partially offset by higher operating expenses.
Added
Shipments to Asia totaled $1,505.3 million in fiscal 2024 (approximately 40% of revenue) compared to $1,549.0 million in fiscal 2023 (approximately 43% of revenue). 35 Table of Contents Gross Margin The increase in gross margin in fiscal 2024 was driven by lower charges associated with a long-term capacity reservation agreement and improved factory utilization.
Removed
Operating expenses increased primarily due to higher personnel costs, a goodwill impairment charge and increased product development spend, partially offset by lower intangible amortization expense and lower incentive-based compensation. • Net income per diluted share was $9.26 for fiscal 2022, compared to net income per diluted share of $6.32 for fiscal 2021. • Cash flows from operations was $1,049.2 million for fiscal 2022, compared to $1,301.9 million for fiscal 2021.
Added
In fiscal 2022, we entered into a long-term capacity reservation agreement with a foundry supplier to purchase a certain number of wafers through calendar year 2025.
Removed
This year-over-year decrease was primarily due to increased inventory as well as prepayments of certain fees and deposits associated with a long-term capacity reservation agreement.
Added
During fiscal 2023, the agreement was amended to extend the term through calendar year 2026, and we recorded charges of $181.0 million to "Cost of goods sold" based on the actual and estimated purchase shortfalls. During fiscal 2024, the agreement was terminated effective December 31, 2023, and we are no longer obligated to order silicon wafers from the foundry supplier.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeIf the Credit Facility were to be drawn (through a term loan or our Revolving Facility), it would bear interest at a variable rate. See Note 9 of the Notes to Consolidated Financial Statements for further information. As of April 2, 2022, we did not have any outstanding borrowings under the Credit Facility.
Biggest changeIf the 2024 Revolving Facility were to be drawn, it would bear interest at a variable rate. Refer to Note 10 of the Notes to Consolidated Financial Statements for further information. As of March 30, 2024, we did not have any outstanding borrowings under any revolving facility.
We also have an active reclamation process to capture any unused gold. While we attempt to mitigate the risk of increases in commodities-related costs, there can be no assurance that we will be able to successfully safeguard against potential short-term and long-term commodity price fluctuations. 46 Table of Contents
We also have an active reclamation process to capture any unused gold. While we attempt to mitigate the risk of increases in commodities-related costs, there can be no assurance that we will be able to successfully safeguard against potential short-term and long-term commodity price fluctuations. 47 Table of Contents
Operating expenses and certain working capital items related to our foreign-based operations are, in some instances, denominated in the local foreign currencies and therefore are affected by changes in the U.S. dollar exchange rate in relation to foreign currencies, such as the Costa Rican Colon, Euro, Pound Sterling, Renminbi, and Singapore Dollar.
Operating expenses and certain working capital items related to our foreign-based operations are, in some instances, denominated in the local foreign currencies and therefore are affected by changes in the U.S. dollar exchange rate in relation to foreign currencies, such as the Costa Rican Colon, Euro, Renminbi and Singapore Dollar.
We manage these Underlying Exposures through operational means as well as through the use of various financial instruments when deemed appropriate. The method and extent to which we are able to reduce the financial impact related to the Underlying Exposures may vary over time.
We manage these Underlying Exposures through operational means, balance sheet management, as well as through the use of various financial instruments when deemed appropriate. The method and extent to which we are able to reduce the financial impact related to the Underlying Exposures may vary over time.
See Note 7 of the Notes to Consolidated Financial Statements for further information. Commodity Price Risk We routinely use precious metals in the manufacture of our products. Supplies for such commodities may from time to time become restricted, or general market factors and conditions may affect the pricing of such commodities.
Refer to Note 8 of the Notes to Consolidated Financial Statements for further information. Commodity Price Risk We routinely use precious metals in the manufacture of our products. Supplies for such commodities may from time to time become restricted, or general market factors and conditions may affect the pricing of such commodities.
If the U.S. dollar weakens compared to these and other currencies, our operating expenses for foreign operations will be higher when remeasured back into U.S. dollars. We seek to manage our foreign currency exchange risk in part through operational means.
If the U.S. dollar weakens compared to these and other currencies, our operating expenses for 46 Table of Contents foreign operations will be higher when remeasured back into U.S. dollars. We seek to manage our foreign currency exchange risk in part through operational means.
Similarly, there can be no assurance that our financial risk management activities will be successful in mitigating the financial impact resulting from movements in the Underlying Exposures. 45 Table of Contents Interest Rate Risk We may be exposed to interest rate risk via the terms of our Credit Facility.
Similarly, there can be no assurance that our financial risk management activities will be successful in mitigating the financial impact resulting from movements in the Underlying Exposures. Interest Rate Risk We may be exposed to interest rate risk via the terms of the 2024 Revolving Facility.
Equity Price Risk Our marketable equity investments in publicly traded companies are subject to equity market price risk. Accordingly, a fluctuation in the price of each equity security could have an adverse impact on the fair value of our investments. As of April 2, 2022, our marketable equity investments were immaterial.
Equity Price Risk Our marketable equity investments in publicly traded companies are subject to equity market price risk. Accordingly, a fluctuation in the price of each equity security could have an adverse impact on the fair value of our investments. As of March 30, 2024, our marketable equity investments were immaterial.
If the U.S. dollar declined in value 10% in relation to the re-measured foreign currency instruments, our net income would have decreased by approximately $4.4 million in fiscal 2022. If the U.S. dollar increased in value 10% in relation to the re-measured foreign currency instruments, our net income would have increased by approximately $3.6 million in fiscal 2022.
If the U.S. dollar declined in value 10% in relation to the re-measured foreign currency instruments, our net income would have decreased by approximately $5.9 million in fiscal 2024. If the U.S. dollar increased in value 10% in relation to the re-measured foreign currency instruments, our net income would have increased by approximately $4.8 million in fiscal 2024.
For fiscal 2022, we incurred a foreign currency loss of $1.5 million as compared to a loss of $3.8 million in fiscal 2021, which is recorded in "Other income (expense), net." Our financial instrument holdings, including foreign receivables, cash and payables at April 2, 2022, were analyzed to determine their sensitivity to foreign exchange rate changes.
For fiscal 2024, we incurred a foreign currency gain of $0.4 million as compared to a loss of $0.6 million in fiscal 2023, which is recorded in "Other income, net." Our financial instrument holdings, including foreign receivables, cash and payables at March 30, 2024, were analyzed to determine their sensitivity to foreign exchange rate changes.

Other QRVO 10-K year-over-year comparisons